Challenges for financial managers in changing economic environment.

https://www.sciencedirect.com/science/article/pii/S2212567115010540

The article is

Ilie, L. (2015). Challenges for financial managers in changing economic environment. Procedia Economics and Finance, 27, 726-730. Retrieved from https://www.sciencedirect.com/journal/procedia-economics-and-finance/vol/27/suppl/C

 

https://doi.org/10.1016/S2212-5671(15)01054-0

 

After you download and read the article, respond to the following question from Session Please do this as a “response.”

 

1. What are 3 fundamental decisions that are of concern the finance team? What is the impact of these on the balance sheet?

 

2. Explain the difference between a stakeholder and a stockholder and why both are important to the success of an organization.

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 2 Discussion

 

The topic for discussion this week is: Cash Flow and Taxes

 

1. How does net cash flow differ from net income and why is that difference relevant to financial decision making?

 

2. With regard to tax purposes, which type of depreciation methods do organizations prefer and why?

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 3 Discussion

 

The discussion topic for this week is: Analyzing Financial Statements

 

1.  Analyze ROA and ROE and how each one fits into Profitability Ratios.

 

2. What is financial leverage? What are the benefits and risks associated with financial leverage?

 

 

 

 

 

 

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 4 Discussion

 

1. What are the differences between simple interest and compound interest

 

2. With regards to money: What are the differences between future value and present value?

 

3. What considerations do you need to take when considering “time value of money”?

 

4. Why is the following statement true? “A dollar today is worth more than a dollar tomorrow.”

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 5 Discussion

 

1. Explain the difference between required rate of return and expected rate of return. If they are different at a specific point in time, what does it mean?

 

2. What is the difference between an expected return and a total holding period return?

 

3. How does investing in more than one asset reduce risk through diversification?

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 6 Discussion

 

1. What is opportunity cost and why is it an important concept in the capital budgeting process? The opportunity cost concept applies to almost every financial decision we make as individuals. Can you give an example from your own experience?

 

2. What is capital rationing from the perspective of capital budgeting?

 

3. Give an example of a strength and a weakness of the accounting rate of return approach.

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 8 Discussion

 

1. How is the concept of incremental analysis used in decision making?

 

2. What does it mean when someone says “You get what you measured”?

 

3. What are the impacts of information technology?

 

 

 

 

 

 

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 9 Discussion

 

1. What is relevant range?

 

2. Give two examples of costs that are variable costs and two examples of fixed costs.

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 10 Discussion

 

1. Explain the responsibility of the accounting department.

 

2. What is one advantage of having 2 costs pools (one for fixed costs and one for variable costs) for each service department?

 

 

 

MGMT640 Financial Decision Making for Managers

 

Session 11 Discussion

 

1.How would a manager use economic theory to determine profit-maximizing price for a service or product?

 

2. What is the process of target costing? How is target cost calculated?

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