The UNIVERSITY OF TOLEDO

College of Business Administration

BUAD 6200:911 Financial Systems (Corporate Finance)
2013 - Summer
Instructor: Shawn Tysiak
Office: Stranahan Hall, ST-4016
E-mail: stysiak@utnet.utoledo.edu
Phone: (419)50-!"66
Class Time: DL Course
Classroom: DL Course
Office Hours: #y a$$oint%ent only
1. Course Overview
This is one of your main corporate finance courses. It covers not only the broad range of
issues faced by corporate finance managers but also the analytical tools required to solve these
issues. In a very broad sense, the course concentrates on
(i) Investment decision of a corporation:
What real assets or projects should a firm invest to create value
(ii) !inancing decision of a corporation:
"o# to finance its chosen projects, debt or equity, etc.
(iii) $apital structure: "o# much debt should a firm have in its capital structure
(iv) $orporate payout policy: %ividend versus share repurchases.
(v) &oreover, the course also addresses valuation of bonds and stocks and the
risk-return tradeoff concept in finance and revie#s the time value of money concept.
2. Textbook and Materials
Textbook: (required): Corporate Finance, by 'oss(Westerfield()affe, *+
th
Edition, &c,ra# "ill,
-+*+.
We will be using CONNECT your homework! When you
purchase the book do not orget to buy a book that has an access
code!
There are a ew options with either an e"book# hard co$er# % ring
binder and all may or may not include CONNECT!
(recommended): ($!. Te/t) Corporate Finance: A ractical Approach, by
&ichelle '. $layman, $!., &artin 0. !ridson, ,eorge ". Troughton, -
st
edition,
-+*-, Wiley 1ublishing, $!. Institute2s required te/t on $orporate !inance. Those
#ho are interested in $!. e/ams #ill have to go through this te/t. 3ou can compare
*
#hat #e cover in our course and #hat is required for $!. e/ams2 corporate finance
part.
-
Calculator: !" #A-lus-"" or $-10# is re%uired.
. #ord of caution4 !inancial calculator #ill help you solve many problems in time
value of money, bond and stoc5 valuation very quic5ly. .lso, it #ill help you solve
capital budgeting problems quic5ly and the case. This #ill be quite important in an
e/am situation as #ell as for solving home#or5 problems. .s such, you should
consider about 67+ investment for a financial calculator a very cheap investment. 8n
top of it, #hen you #ant to buy car, home, and start investing in the future, it #ill be
the most valuable tool to have in your daily life.
Communication: This is a distance learning course. 9verything, home#or5, lectures,
information about #ee5ly schedule, etc. #ill be provided through :lac5board. .s
such, chec5ing :lac5board in a timely manner #ill be important to 5eep up #ith the
material.
! will use "lackboard #or emails$ not m% and %our &ersonal emails.
I #ill send emails to the entire class using :lac5board.
'. Course (equirements
)rerequisites:
$ompletion of !I;.(<7*+ or its equivalent is required to ta5e this course.
CO**ECT :
$8;;9$T is a home#or5 management tool and also provides lots of information for you to use
in your studies. =se the >?earn0mart2 feature (found on the $8;;9$T homepage) to help you
determine #hat areas from each chapter you need to focus on so that you can do #ell in the class.
+omework:
There #ill be an individual home#or5 after each chapter is finished administered through &c,ra#
"ill2s @$8;;9$T future. That is the reason you must have a @$8;;9$TA account through
&c,ra# "ill.
3ou are allo#ed 7 attempts at each question. If you do not 5no# ho# to solve then be sure to clic5
on the >sho# correct ans#er2 button after you submit the question. Then you #ill get another
attempt. .ll questions are algorithmic and #ill change #ith each attempt you ma5e. If you got the
ans#er correct then you do not need to do any additional attempts.
3ou must complete the assignment by the due date (given at the end of the syllabus) if you do not
then you #ill earn a + on that home#or5 assignment.
.ll home#or5 assignments #ill be available to you starting the *
st
day of class. 3ou can see the due
dates of each assignment in the syllabus and on $8;;9$T. !eel free to #or5 ahead4
3ou #ill see in $8;;9$T that there are sample home#or5 assignments. !eel free to #or5 through
the e/amples at your leisure.
7
)ower)oint
T#o are available for you to use.
*
st
( ;arrated 1o#erpoint( To access from $8;;9$T go to >?ibrary2 then clic5 on >0tudent
'esources2 then select the chapter and then clic5 on >narrated slides2
-
nd
( 0tandard 1o#er1oint( I #ill post in either :lac5board andBor on $8;;9$T
Midterm:
On the ourth week, there #ill be a midterm.
0ince the midterm e/am is online (available in $onnect). 3ou can use your boo5sBnotes.
The e/am is timed so do not attempt to loo5 up all the ans#ers. 8ther#ise, you #ill run
out of time44
,inal Exam:
You must tae t!e "inal e#am on campus on one o" t!e "ollo$in% &ates:
'on&ay( )uly 29t! to Fri&ay( Au%ust 2n&* +!e "inal $ill ,e a&ministere&
in t!e U+ testin% center $!ic! is locate& in t!e 'emorial Fiel& -ouse on
U+.s main campus*
+!e "inal e#am is /0+ cumulati1e: 2t $ill inclu&e material co1ere& a"ter
t!e mi&term* ( 2 $ill pro1i&e you a "ormula s!eet a!ea& o" time)
+!e "inal e#am is not open ,oo3notes
Case:
There #ill be one case that you #ill #or5 as groups. 1lease form groups of 7 or C students and send
me an email #ith all of your group members. The group assignment #ill start about #ee5 C and #ill
be due by Wednesday, )uly 7*
st
at **:<Dpm. 3ou #ill be as5ed to read the case and then ans#er
questions about the case study.
-radin.: The follo#ing table sho#s the distribution of course grade:
+omework
Midterm
Case
,inal
Total
C
&rading 'cale(
.E D-.+F and aboveG .(ED+.+(D*.DF
:HEII.+ to ID.DG :EI-.+ to IJ.DG :(EI+.+ to I*.D
$HEJI.+ to JD.DG $EJ-.+ to JJ.DG $(EJ+.+ to J*.D
%HEKI.+ to KD.DG %EK-.+ to KJ.DG %(EK+.+ to K*.D
!E <D.D and belo#
/. 0earnin. Ob1ectives
i. To &rovide cor&orate #inance back.round in order to develo& critical thinkin. in
#inancial mana.ement issues o# a cor&oration.
!or a successful financial manager, understanding the subject is the first step to develop a
critical thin5ing in financial management issues. The course #ill cover the follo#ing as a
bac5ground for financial management subject:
*. 4e1ie$ t!e time 1alue o" money concept an& learn t!e tec!ni5ues
to 1alue stocs an& ,on&*
-. De1elop t!e sills to e1aluate pro6ects t!at create 1alue "or
s!are!ol&ers (capital ,u&%etin%)*
7. 7#plain t!e ris8return tra&eo"" an& t!e Capital Asset 9ricin% 'o&el
(CA9')*
C. Un&erstan& an& analy:e t!e "inancin% (capital structure) &ecisions
relate& to 1alue creation in a corporation*
<. Un&erstan& an& analy:e corporate payout policies*

ii. To enhance teamwork skills.
.bility to #or5 #ith others #ill have an important contribution to a successful career as a
financial manager. To contribute to your team#or5 s5ills in this class, one case as #ell as
periodic I to * home#or5 #ill be assigned to the groups of t#o(to(four.
iii. To shar&en written communication. $ase assignment requires each group to submit
ma/imum three pages (e/cluding tables, references, etc.) of #ritten paper analyLing each
case. 'estricting the assignment to three pages forces student to learn #riting in a concise,
effective #ay.
Student Behavior in This Course
As a student taking coursework in this College, you have an obligation to maintain the
highest standards of ethical conduct. This involves avoiding acts of academic dishonesty. The
reason for requiring the highest standards of ethical conduct is to ensure fairness, honesty and
integrity in the evaluation of student performance. Evaluation of student performance should
not be invalidated by students intending or attempting to misrepresent the skill, achievement or
ability of either themselves or others.
<
To achieve this purpose, the College has enacted a Code of Student Academic Conduct.
This Code sets forth specific types of academic misconduct which will not be tolerated. f there
is any evidence of any of these types of academic misconduct in this course, charges will be
filed against the student or students involved. Along with the Code, the College has also
enacted a Student Academic !rievance "rocedure. The purpose of this grievance procedure is
to provide the e#clusive method by which a student can file a grievance if he$she believes that
the charge of academic misconduct is false or to grieve a final course grade which he$she
believes has been unfairly or erroneously assigned.
%oth the Code of Student Academic Conduct and the Student Academic !rievance
"rocedure can be reviewed on the College of %usiness Administration website. The form to be
used when filing a grievance is also available on the website.
Topics and Assin!ents"
#The $o%%o&in schedu%e is tentative and thus su'(ect to chane)
T!ME TO)!C
233!-*ME*T3
#rom Connect
Corres&ondin.
cha&ters in the
C,2 Text
K
4eek 1
)une -C
th
M
)une 7+th
.n Introduction to the $ourse
Cha&ter1: Introduction to $orporate !inance
Cha&ter2: !inancial 0tatements and $ash
!lo#

$ontinue to $hapter(-
Cha&ter/: %iscounted $ash !lo# Naluation
*OTE: I assume you already familiar #ith Time Nalue of &oney
calculations from your required !I;.(<7*+ or comparable
!inancial &anagement course. Therefore, I #ill be brief on this444
+owever, if you have difficulties #ith this concept and its
applications, please as5 me.
) also put Tutorial iles or T)"*+)) ,lus and -,"./*))
calculators in the ,0F ormat into the *lackboard!
"W* (ch -) O "W - (ch C)
are due on &onday 5ul% 1
st

at **:<Dpm
4eek 2
)uly *
st
M
)uly Jth
6207E8
Cha&ter9: Interest 'ates and :ond Naluation
Cha&ter:: 0toc5 Naluation
"W 7 (ch I
and D) are due
on &onday,
5ul% 9
th
at
**:<Dpm
)art o# Ch
': Cost o#
Ca&ital
4eek '
)uly I
th
M
)uly *Cth
Cha&ter;: ;et 1resent Nalue and 8ther
Investment 'ules

Cha&ter<: &a5ing $apital Investment
%ecisions

"W C (ch <)
and "W < (ch
K) are due on
&onday 5ul%
1;
th
at
**:<Dpm
Ch2:
Ca&ital
"ud.etin.
4eek /
)uly *<
th
M
)uly -*st
M!=TE(M is available on
Connect startin. Monda% 5ul% 1;
th


to Monda%$ 5ul% 22
nd
at 11:;:&m
(!3> 8
Cha&ter1?: 'is5 and 'eturn: ?essons from
&ar5et "istory

Cha&ter11: 'eturn and 'is5: The $apital(
.sset 1ricing &odel ($.1&)
"W K (ch *+
and ch **) are
due on
&onday, 5ul%
22
nd
at
**:<Dpm
Ch': Cost
o# Ca&ital
4eek ;
)uly --
nd
M
)uly -Ith
Cha&ter1': 'is5, $ost of $apital, and
Naluation
Cha&ter1<: $apital 0tructure
Ch': Cost
o# Ca&ital
Ch/:
Ca&ital
3tructure
and
"W J (ch *7),
"W I (ch *K
J
Cha&ter1@: $apital 0tructure
Cha&ter1:: %ividends O 8ther 1ayouts:

and ch *J), and
"W D (ch *D)
are due on
&onday$ 5ul%
2:
th
at
**:<Dpm
0evera.e
4eek<
)uly -D
th
M
.ug -nd
,!*20
2vailable Monda%$ 5ul% 2:
th
to ,rida%$
2u.ust 2
nd
at the Testin. Center in the
Memorial ,ield +ouse on 7TAs Main
Cam&us
Testing Center phone number(1.2"3%/"4/..
-ours( 5onday 6 Friday 7(%/am 6 1(13pm

Case &ue ;e&nes&ay( )uly <1st
Ch/:
Ca&ital
3tructure
and
0evera.e
I