Syllabus
Corporate Finance
1148-FIU01-FIN-6406-SECRXQ_AP_1148-86029
GENERAL INFORMATION | IMPORTANT INFORMATION | COURSE DETAIL | COURSE CALENDAR
GENERAL INFORMATION
PROFESSOR INFORMATION Instructor:
Prof. Edward R. Lawrence
Phone:
(305) 348-0082
Office:
RB 207A
Fax:
(305) 348-4245
Office Hours:
By Appointment
E-mail:
elawrenc@fiu.edu
Website:
Professor's Bio
COURSE DESCRIPTION AND PURPOSE
The course is covered in two parts. In part one; we will have an overview of financial management and financial environment. We will analyze firm’s financial performance using financial ratio analysis. We will then discuss the time value of money (TVM) and use the concept of TVM in the valuation of bonds and stocks. In part two we will understand the methods for computing cash flows and the company’s cost of capital and then use them to learn capital budgeting which involves project selection decisions.
COURSE OBJECTIVES
The objective of this course is to give the students an operational knowledge of corporate finance by combining theory and applications. Introduce the concepts or risk, return, and time-value-of-money as applied to valuation of securities and capital budgeting. Here are the course level learning outcomes:
1. Perform Internet research and find relevant financial data.
2. Use information technology to assess the financial position of organizations.
3. Learn how to perform financial statement analysis.
4. Learn the mathematics of Time Value of Money.
5. Compute the price of bonds and the intrinsic value of stocks.
6. Learn the use of Capital Asset Pricing Model (CAPM).
7. Calculate firm’s cash flow using its income statement and balance sheet.
8. Learn project selection criterion.
Week 1: Introduction to the Fundamental Concepts of Corporate Finance and Financial Statements
9. Students will be able to explain and evaluate the Anglo-Saxon concept of shareholder wealth maximization, how it relates to other possible objectives of the firm's management, as well as the nature of the agency relationship inherent in the corporate structure.
10. Students will be able to learn the motivation behind corporate social responsibility and good governance issues
11. Students will learn the significance of information included in the income statement and balance sheet, discuss the importance of the cash flow statement and explain the difference between accounting net income for the firm and cash flow.
Week 2: Analysis of Financial Statements
12. Students will be able to analyze the success, failure, and progress of a firm's financial performance using financial ratio analysis.
13. Students will be able to analyze ways of improving firm’s performance using Du Pont system.
Week 3: Time Value of Money
14. Students will be able to explain the concepts of compounding and discounting and utilize these tools to calculate the future value and present value of lump sums, annuities, and uneven cash flow streams and in addition calculate the value of other variables such as the effective interest rate, time-period, and periodic payments.
Week 4: Bonds & Interest Rates
15. Students will be able to describe how interest rates are determined and the role played by financial markets and institutions in the global financial system.
16. Students will learn about the determinants of intrinsic value and utilize these concepts to determine the value and yields of bonds.
Week 5: Risk/Return Tradeoff and CAPM
17. Students will be able to determine the expected rate of return and risk of an individual investment as well as a portfolio of assets, including concepts such as standard deviation, correlation, diversification, and the trade-off between risk & return.
18. Students will compute the systematic risk.
19. Students will learn about the capital Asset Pricing Model.
Week 6: Stock Valuation
20. Students will learn the concepts, be able to compute the intrinsic value and utilize the various models available to determine the value and yields of preferred and common stocks.
Week 7: Capital Budgeting & Evaluating Cash Flows
21. Students will calculate various measures of project profitability using traditional capital budgeting techniques including Payback Period, Discounted Payback, Net Present Value, Internal Rate of Return, and Modified Internal Rate of Return.
Week 8: Cost of Capital
22. Students will be able to explain the concept of the cost of capital, how it is affected by the firm’s capital structure, and the application of these concepts to capital budgeting decision making and dividend policy.
TEACHING METHODOLOGY
This course covers a substantial amount of material. Online lectures are based on the assumption that students read and at least partially understand the assigned materials. All exams will be multiple-choice. Students are encouraged to have a business function calculator and to use them to work the problems in the video lectures and notes.
ASSURANCE OF LEARNING
The College of Business cares about the quality of your education. For more information please visit the Assurance of Learning website to learn more on the College’s commitment to this initiative.
IMPORTANT INFORMATION
POLICIES
Please review the FIU's Policies webpage. The policies webpage contains essential information regarding guidelines relevant to all courses at FIU, as well as additional information about acceptable netiquette for online courses.
TECHNICAL REQUIREMENTS & SKILLS
One of the greatest barriers to taking an online course is a lack of basic computer literacy. By computer literacy we mean being able to manage and organize computer files efficiently, and learning to use your computer's operating system and software quickly and easily. Keep in mind that this is not a computer literacy course; but students enrolled in online courses are expected to have moderate proficiency using a computer.
This course utilizes the following tools:
• Adobe Connect
• Turnitin
Please visit our Technical Requirements webpage for additional information.
ACCESSIBILITY AND ACCOMMODATION
Please visit our ADA Compliance webpage for information about accessibility involving the tools used in this course.

Please visit Blackboard's Commitment Accessibility webpage for more information.

For additional assistance please contact FIU's Disability Resource Center.
COURSE PREREQUISITES
Review the Course Catalog webpage for prerequisites information.
TEXTBOOK

Brigham Corporate Finance: A Focused Approach
Michael C. Ehrhardt and Eugene F.
Cengage Learning, Fifth Edition, 2013 ISBN-10: 1133947530
ISBN-13: 978-1133947530

Additional Resources:
• Financial Calculator (Texas Instruments BA II Plus, recommended)
• Wall Street Journal
EXPECTATIONS OF THIS COURSE
This is an online course, which means most (if not all) of the course work will be conducted online. Expectations for performance in an online course are the same for a traditional course. In fact, online courses require a degree of self-motivation, self-discipline, and technology skills which can make these courses more demanding for some students.
Students are expected to:
• Introduce yourself to the class during the first week by posting a self introduction in the appropriate discussion forum
• Take the practice quiz to ensure that your computer is compatible with Blackboard
• Interact online with instructor/s and peers
• Review and follow the course calendar
COURSE DETAIL
COURSE COMMUNICATION
Communication in this course will take place via Messages.
Messages is a private and secure text-based communication system which occurs within a course among its Course members. Users must log on to Blackboard to send, receive, or read messages. The Messages tool is located on the Course Menu, on the left side of the course webpage. It is recommended that students check their messages routinely to ensure up-to-date communication.
Visit our Writing Resources webpage for more information on professional writing and technical communication skills.
DISCUSSION FORUMS
Keep in mind that your discussion forum postings will likely be seen by other members of the course. Care should be taken when determining what to post.
This is a fully online course and hence there are no scheduled class meetings. Students are fully responsible to keep up with the course content in the Blackboard. Students can message the coach and the professor directly within the Blackboard system and will get a response with 48 hours, however it is highly advisable that the students pose questions in the “discussion board” on the blackboard since it is an opportunity for interaction with your classmates and your questions may be answered either by the Professor or your classmates even before you’ve thought of them!
It is necessary for each person to respond to another’s comment to provide a different perspective to the discussion. If you wait until the last minute you will not have the benefit of learning from others as it is highly likely that others may not see your own posting in time.

I encourage you to participate in the General Forum of the discussion boards. Any subject related enquiry should be posted on the discussion board (and not to my email inbox) so I reply to them and it benefit of all students.
ASSESSMENTS
In order to mitigate any issues with your computer and online assessments, it is very important that you take the "Practice Quiz" from each computer you will be using to take your graded quizzes and exams. It is your responsibility to make sure your computer meets the minimum hardware requirements.
Quizzes:
Students will take four quizzes in which they will be required to analytically solve qualitative and quantitative problems. For each quiz, students will be given two attempts and 30 minutes for each attempt. Highest score out of the two attempts will be recorded.
Detailed solutions of the quizzes will be available by 8:00AM of the following morning from the date due.
Exams:
Students will be individually assessed by two multiple-choice exams that contain about 75% problems and about 25% conceptual questions. These are not cumulative per se, but build on the knowledge and skills amassed throughout the course.
Important Information:
Assessments in this course are not compatible with mobile devices and should not be taken through a mobile phone or a tablet. If you need further assistance please contact FIU Online Support Services.
ASSIGNMENTS
Students will work on the problems in the chapter notes that are qualitative and quantitative in nature as a form of formative assessment that will help ensure good performance in the graded assessments.
Students have an option of forming the groups on their own. If you need help forming groups contact your coach as soon as possible. Changes in the groups formed at the beginning of course are allowed only in extreme situations and only after the approval from course instructor. The various aspects of the project will be outlined on the class web page.
Please note that the following information only applies if your course requires the use of Turnitin to submit your assignments.
• Review the detailed Turnitin Instructions on how to submit your assignments and how to review the Grademark comments (feedback) from your professor.
IMPORTANT NOTES
• All times are US Eastern Standard Times.
• Detailed solutions of the quizzes will be available by 8:00AM of the following morning from the date due.
• To guarantee academic integrity and to ensure that the outcomes from your degree are accurately assessed (thus guaranteeing continued quality assurance) your exams may be proctored using applicable software.
• Use your time wisely, during weeks that there are no grade-able assessments due, read ahead and do the problems in the notes to check your understanding of the material.
• When submitting your discussion postings as far as possibly cut and paste your response directly in the text box for ease of reading and assessment. It is necessary for each person to respond to another’s comment to provide a different perspective to the discussion. If you wait until the last minute you will not have the benefit of learning from others as it is highly likely that others may not see your own posting in time.
• For project part one (company selection) and project part two (ratio analysis) only one set of answers needs to be turned in per group and answers must be typed.
GRADING
Student Performance Outcomes
38. Students will work on the problems in the chapter notes that are qualitative and quantitative in nature as a form of formative assessment that will help ensure good performance in the graded assessments.
39. Students will take four quizzes in which they will be required to analytically solve qualitative and quantitative problems. For each quiz, students will be given two attempts and 30 minutes for each attempt. Highest score out of the two attempts will be recorded.
40. Students will be individually assessed by two multiple-choice exams that contain about 75% problems and about 25% conceptual questions. These are not cumulative per se, but build on the knowledge and skills amassed throughout the course.
41. In a group research project, students will perform quantitative and qualitative financial ratio analyses, which include Internet search tasks that assess a company’s financial situation, performance and future potential. It is highly advised that students work in groups on this research project. Choose your groups in the first week based on an analysis of the strengths of others that you know are complementary to your own. There can be a maximum of three students in a group. If you need help forming groups contact your coach as soon as possible. The project will involve peer evaluation and students who do not perform adequately as per other members of the group may get lower grades and/or will be expected to do ALL the work on their own. In the corporate world you will be expected to collaboratively solve problems with the most efficient use of available resources. This project will give you the opportunity to collaborate in a financial context.
42. Students will participate in one Discussion Forum that require their knowledge of topical issues and how the situation can be assessed and solved using techniques from assigned text readings or business periodicals. For the discussion forum, you must provide constructive feedback to at least two other students to earn the assigned points.
The final grade will be determined by the student's performance on two exams, Four quizzes, a discussion forum and a project.
GRADING
Course Requirements Weight
Exam 1 30%
Exam 2 30%
Quizzes 20%
Project 15%
Discussion Forum (both parts) 5%
Total 100%
Letter Range Letter Range Letter Range
A 91 - 100% B- 80 - 81 D+ 67 - 69
A- 89 - 90 C+ 77 - 79 D 64 - 66
B+ 87 - 88 C 74 - 76 D- 60 - 63
B 82 - 86 C- 70 - 73 F < 60
ADOBE CONNECT PRO MEETING
Adobe Connect is an online meeting room where you can interact with your professor and fellow students by sharing screens, sharing files, chatting, broadcasting live audio, and taking part in other interactive online activities.
Meetings will be available on the following dates:
Meeting 1: Oct. 15th, 7:00 PM - 8:00 PM
Meeting 2: Oct. 22nd, 7:00 PM - 8:00 PM
Meeting 3: Oct. 29th, 7:00 PM - 8:00 PM
Meeting 4: Nov. 19th, 7:00 PM - 8:00 PM
Meeting 5: Dec. 3rd, 7:00 PM - 8:00 PM
Requirements for using Adobe Connect:
• Disable any window pop-up blocker.
• Adobe Flash Player is required to successfully run your Adobe Connect meeting. You can test your computer to make sure your computer and network connections are properly configured to provide you with the best possible Adobe Connect meeting experience.
• Use of a combination headset and microphone with USB connection is recommended to ensure quality sound and reduce technical difficulties.
COURSE CALENDAR
WEEKLY SCHEDULE
All times are US Eastern Standard Times
Date Topic Readings and Lectures Assignment
Week 1
Oct. 13th -
Oct. 19th • Introduction
• Financial Statements Cash Flow and Taxes
• Chapter 1, 2 • Read notes on Chapter 1 & 2.
• Watch Introduction video. • Take Quiz 1 by 11:59 PM on Oct 19th
• Adobe connect: Oct 15th, 7:00 PM to 8:00 PM
Week 2
Oct. 20th -
Oct. 26th • Analysis of Financial Statements
• Chapter 3
• Project Discussion • Read notes on Chapter 3.
• Watch video on ratio analysis. • Take Quiz 2 by 11:59 PM on Oct. 26th
• Adobe connect: Oct. 22nd, 7:00 PM to 8:00 PM
Week 3
Oct. 27th -
Nov. 2nd • Time Value of Money
• Chapter 4 • Read notes on Chapter 4.
• Watch video on Time Value of Money. • Take Quiz 3 by 11:59pm on Nov. 2nd
• Project Part One (company selection) due by 11:59 PM on Nov. 2nd
• Adobe Connect: Oct. 29th, 7:00 PM to 8:00 PM
Week 4
Nov 3rd -
Nov 9th • Valuing Bonds
• Chapter 5 • Read notes on Chapter 5.
• Watch video on Bonds and Yield to Maturity. • Exam 1: From 8:00 AM on Nov. 7th to 11:59 PM on Nov. 9th (Covers Chapters 1,2,3,4 & 5)
Week 5
Nov. 10th -
Nov. 16th • Risk, Returns, Beta and CAPM
• Chapter 6
• Discussion • Work on Project
• Read notes on Chapter 6.
• Watch video on CAPM. • Work on Project
• Discussion Board: Post your response by 11:59 PM on Nov. 13th and reply to at least two of your peers by 11:59 PM on Nov. 16th
Week 6
Nov. 17th -
Nov. 23rd • Valuing Stocks
• Chapter 7 • Read notes on Chapter 7.
• Watch video on Valuing Stocks. • Project Part Two (ratio analysis) by 11:59 PM on Nov. 23rd
• Adobe Connect: Nov. 19th, 7:00 PM to 8:00 PM

Nov. 24th Thanksgiving Break - No Assignments this week.
Week 7
Dec. 1st -
Dec. 7th • Capital Budgeting
• Chapter 10 • Read notes on Chapter 10.
• Watch video on Capital Budgeting. • Take Quiz 4 by 11:59 PM on Dec 7th.
• Complete Peer Evaluation by 11:59 PM on Dec 2nd.
• Adobe Connect: Dec. 3rd, 7:00 PM to 8:00 PM
Week 8
Dec. 8th -
Dec. 12th • Cost of Capital
• Chapter 9 • Read notes on Chapter 9.
• Watch video on weighted Average Cost of Capital. • Exam 2: From 8 AM on Dec. 10th to 11:59 PM on Dec. 12th (Covers Chapters 6,7,9 & 10) Florida International University Online
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