Winthrop University
College of Business Administration
Financial Policy Management
FINC 655
Office Hours: T 4-6 & TH 4-6
Dr. James Schultz
Summer 2010
Thurmond 526
E-mail schultzj@winthrop.edu webpage faculty.winthrop.edu\schultzj\default.htm
Phone 323-2162
Required Textbook: Fundamentals of Corporate Finance, RWJ, 9th edition
Credit Hours: 3
Pre-Requisites: Principles of Finance (FINC 311)
Course Description
A lecture and computer application course examining financial management decision making
such as financial ratios, budgets, time value of money, security valuation and capital
budgeting.
Course Content
Chapter 1: Introduction
Chapter 2: Financial Statements, Taxes, and Cash Flow
Chapter 3: Working with Financial Statements
Chapter 5: Time Value of Money
Chapter 6: Discounted Cash Flow Valuation
……………….Exam 1……………………
Chapter 7: Interest Rates and Bond Valuation
Chapter 8: Stock Valuation
Chapter 9: Net Present Value and Other Investment Criteria
Chapter 10: Making Capital Investment Decisions
...........................Exam 2................................
Chapter 12: Some Lessons from Capital Market History
Chapter 13: Return, Risk and the Security Market Line
Chapter 14: Cost of Capital
Chapter 16: Financial Leverage and Capital Structure Policy
…………………Exam 3……………………
Tentative Schedule:
With this being an accelerated summer course, you can expect to cover a minimum of
one chapter per class period, with most sessions covering multiple chapters.
Exams:
The timing of these exams will depend on the flow of the class. However, each exam
will cover the material during that section of the course (ex: exam 1 will cover chapters
1,2,3,5,6…exam 2 will cover 7-10, etc.). Exams will consist of some combination of the
problems and short essays. Students must take all exams at the time they are scheduled.
Failure to do so will result in a grade of a "0" for the exam. There will not be any makeup exams. In the case of a medical emergency the student must inform the instructor in
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advance of his or her absence from the exam. Note, the best way to contact the instructor
is through e-mail. As expected the student must provide sufficient evidence to support his
or her absence. No cell phones will be allowed in class during exam periods. Students
will not be allowed to leave the classroom during exam periods. Violation of any of these
policies will result in a grade of “0” for the exam.
Homework:
Problems will be suggested throughout the class as practice for the exams, but no official
homework will be collected.
Project:
Each team will choose a company in the S&P 500 to analyze throughout the semester.
Official details of this project will be given as the semester gets underway.
Bonus Quizzes:
Bonus quizzes will be given randomly throughout the semester to reward those students
who stay on top of their studies. A total of 20 bonus quizzes will be administered with
each quiz worth a total of 5 bonus points. Each student’s bonus point total will be
multiplied by 6% to determine his/her bonus point award. For example, a student who
earns 80 bonus points for the semester will receive 6% of 80, or 4.8 bonus points on
his/her final grade in the class. Therefore, if this student had an overall grade of 80 in the
class he/she would now have 84.8. The professor reserves the right to award bonus
points by other means as well (answering questions in class, working problems on the
board, etc.). Bonus quizzes cannot be made up.
Grading:
Exam One
Exam Two
Exam Three
Project
Total
26.7%
26.7%
26.7%
20%
100%
Grades:
90-100
80-89
70-79
60-69
50-59
A
B
C
D
F
Any student who is still enrolled in the course after the withdrawal deadline will be given
a grade ("A" through "F"). Furthermore, the professor reserves the right to increase a
student’s grade beyond that which was earned due to “intangible” factors such as, but not
limited to: effort, participation, improvement over the semester, etc.
Powerpoint slides and course materials:
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Throughout the semester course documents will be posted online at my website.
Attendance Policy:
Attendance will not directly be graded. It is the student’s responsibility to obtain any
materials from missed classes. Bonus quizzes will be used to indirectly record
attendance.
Students with Disabilities:
Winthrop University is dedicated to providing access to education. If you have a
disability and require specific accommodations to complete this course, contact Gena
Smith, Program Director, Services for Students with Disabilities, at 323-3290. Once you
have your official notice of accommodations from Services for Students with Disabilities,
please inform me as early as possible in the semester.
Student Conduct Code:
As noted in the Student Conduct Code: “Responsibility for good conduct rests with
students as adult individuals.” The policy on student academic misconduct is outlined in
the Student Conduct Code Academic misconduct Policy in the Student Handbook online
(http://www2.winthrop.edu/studentaffairs/handbook/StudentHandbook.pdf).
Professionalism:
The College of Business Administration is preparing students for success in the business
world. Behavior that is not appropriate in a place of business is not appropriate in the
classroom. Have respect for yourself and those around you: no text messaging, no head
phones, no sleeping, no talking during lectures, quizzes, or exams. The class belongs to
all students. Be considerate of others, be engaged but do not dominate the class with
excessive comments or questions. All University conduct policies apply as well.
Course Goals:
 Explain the basic criterion for every financial decision
 Assess the financial health of a company
 Describe the basic function of financial markets and explain why these markets
are important to financial managers
 Explain how financial assets are valued in the market
 Explain how a company raises money by selling stocks, bonds, and other financial
assets
 Calculate interest rates for different types of securities
 Calculate future values and present values for both lump-sums and annuities
 Compute a company’s cost of capital
 Use the proper technique for making investment decisions
 Understand how many of the tools we apply at the corporate level, are also
applicable at the personal level
 Analyze a company from the perspective of a portfolio manager in an effort to
determine this company’s potential as an investment
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
Examine the capital structure tradeoff between debt and equity and understand
how this fits into an optimal capital structure
Course objectives:
1. Understand the analysis of a firm’s financial condition. 2. Learn techniques of financial
planning and budgeting. 3. Learn the concept of risk-reward tradeoff. 4. Understand security
valuation. 5. Learn Capital Structure decisions. 6. Study the techniques of corporate
investment decision.
Students will be asked to apply problem-solving as well critical thinking methods to
financial situations. Furthermore, an understanding of ethical considerations will be
stressed.
Calculators:
The TI BA II Plus is the preferred calculator but you may use any other financial
calculator. A financial calculator is required for this course. If you select a calculator
other than the TI model, you will likely be on your own in learning how to use it. I will
instruct the class how to use the TI model for all problems in the class.
Study Methods:
The best method of studying for this course is to attend all classes, skim each chapter
prior to class, take good lecture notes, refine and study your notes, read the chapters in
their entirety, and work the practice problems and questions. During your readings, pay
particular attention to the sections of text that overlap with lecture notes. This is a
graduate level course, so you can expect the pace to be rather quick at times.
Note: Remember it is your responsibility to contact me in the event of an emergency.
There are two ways that I can be reached: through e-mail and a phone call to my office.
Be thorough and exhaust both options if necessary.
Any changes to the syllabus will be discussed in class and formalized through an official
email to all registered students.
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