Harvard Managerial Finance E 130

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Managerial Finance 
Instructor                     Dr. C. Blent Aybar 
Teaching Assistant             Mr. Ed Caito  email: erccpa@aol.com  
Classroom                      Sever Hall 214  Monday 5:307:30pm 
Communication                  EMail: aybar@fas.harvard.edu 
 Course Website                http://isites.harvard.edu/k46441  
Course Description Objectives 
The course deals with managing business funds and planning their use to accomplish organizational objectives. It 
covers  the  following:  techniques  of  financial  analysis  and  planning  such  as  ratio  analysis,  pro  forma  projections 
and  discounted  cash  flow  analysis;  domestic  and  international  financial  environments;  the  sources  and  uses  of 
financing;  problems  of  capital  structure;  capital  budgeting  and  cost  of  capital;  mergers  and  approaches  to 
business valuation; international financial management. Prerequisite: Introductory accounting or equivalent..  
I  will  use  lectures,  case  discussions  and  overview  of  topical  issues  to  create  a  rich  learning  environment  in  class.  
The  lectures  will  be  supported  by  online  tools  such  as  MyFinance  Lab  and  various  postings  on  the  course 
website. I will emphasize theory and analytics, but also teach the course from an applied perspective.  
Course Requirements 
Students  are  expected  to  carefully  review  the  assigned  reading  materials  before  each  session,  diligently  work  on 
the  assigned  problems/questions  and  cases,  and  to  participate  actively  in  the  class  discussions.  You  should  be 
prepared  to  spend  significant  time  to  digest  the  material,  to  work  on  the  assignments  and  case  studies.   Timely 
submission of the assigned work is critical. Late submissions will not be accepted.  
Best Preperation Method: 
You  should  invariably  read  the  assigned  chapters  and  supplementary  materials  before  you  come  to  the  class  and 
go  over  the  assigned  exercises  and  cases.  After  the  end  of  each  session,  you  should  review  handouts,  your  notes 
and    highlights  in  your  readings.    I  have  created  homework  assignments  for  each  session  in  MyFinance  Lab. 
These homework assignments will help you to master the key concepts, and provide you instant help while you  
work  on  the  exercises.   Although  I  will  not  grade  these  assignments,  I  would  strongly  recommend  you  to  review 
them before you work on session quizzes.  
Textbook and  Resources 
      Principles of Managerial Finance, Gitman 12th Edition, Pearson Prentice Hall, 2009,  
           ISBN: 0321557530 (The textbook with this ISBN also includes MyFinance Lab Kit) 
      Textbook Website: http://wps.aw.com/aw_gitman_pmf_12/85/21793/5579249.cw/index.html 
       Financial  Calculator  (If  you  do  not  have  one,  purchase  an  inexpensive  one.   I  have  been  using HP12C for 
        a long time, but there are other HP and TI products in the market.  
       Subscription to  WSJ or Financial Times  (Strongly Recommended)  
My Finance Lab Instructions 
If you purchased a new textbook at Coop, the book will  come with a Student Access Kit that contains a code you 
can use to register. If you do not have a Student Access Kit, you can purchase access online with a major credit 
To register  the  course, you will need to have the following information on hand: 
      Textbook: Gitman: Principles of Managerial Finance, 12e 
      Your MyFinanceLab Student Access Kit if you have one 
      School's Zip code: 02138 
      A valid email address where you can receive your registration confirmation 
To register: 
      Go to www.myfinancelab.com/, click on Register, and follow the simple online instructions--you'll 
         either Register with an Access Code using your Student Access Kit or Purchase Access with a major 
         credit card. 
      When selecting your school, make sure to select, Harvard Extension School 
      After you have registered, you will be ready to log in to MyFinanceLab. 
To log in and begin using MyFinanceLab:  
Go to www.myfinancelab.com and enter the login name and password you created during registration.  
The first time you log in to MyFinanceLab, select Enroll in my instructors course and choose your 
school(Harvard Extension School), instructor (Bulent Aybar) , and course name  (Managerial Finance Spring 09) 
from the dropdown menus.  
System requirements:  
        Operating systems:  Windows 2000, XP or Vista. Mac OSX 
        Browsers:  Internet Explorer 6.0 or later, FireFox, Safari 
For help with registration: Web site:  http://247.support.pearsoned.com/ 
Telephone:  18006776337 
MondayFriday 8 a.m.8 p.m. ET, Sunday 5 p.m. midnight ET 
     1. Homework Problems:  
     For each session these assignments are posted in MyFinance Lab. They are expected to be worked on before 
     or immediately after the class discussion.  Built in tools available in myfinance lab guides you through the 
     problems with similar examples, textbook references etc. Although I will not grade these homework 
     assignments,  I urge you to work on these on a regular basis. For each session I will also post a quiz. The 
     homework assignments will prepare you for the quizzes.  
     2. Case Analyses 
     We  will  use  three  HBS  case  studies  in  the  second  half  of  the  class.  You  are  expected  to prepare a write up for 
     two out of three cases. However, you should be prepared to discuss all three cases in the class. The case write 
     ups are due on the day we discuss the cases.  
          Case Analysis Guide : 
          Your  write  up  should  be  analytical  rather  than  descriptive  of  the  contents  of  the  case.  Your  analysis 
          should  be  geared  towards  identification  of  key  questions  and  problems,  evaluation  of  the  situations,  and 
          offering  alternatives  and  solutions  as  well  as  discussing    pros  &  cons  of  alternatives  suggested.  You 
          should choose one alternative as a decision maker, and provide a clear reasoning for your decision.  Since 
          most  cases  used  in  the  class  require  a  composite  of  careful  thinking,  conceptualization,  quantitative 
          analysis  and  some  form  of  decision  making  your  analyses  will  be  evaluated  based  on  breadth  and  depth 
          of your thought process documented in your submitted paper. 
     3. Spreadsheet Assignments 
     These  assignments  will  allow  you  to  improve  your  excel  skills  in  the  context  of  the  issues  we  discuss.  I  will 
     post the templates on the course website.  
There  will  be  10  optional  online  quizzes  posted  in  MyFinance  Lab.  If  you  regulary  work  on  these  quizzes  during 
the course and attain an average grade of 85 or above, you will be exempted from the exams.  
If  you  have  not  used  the  quiz  options,  or  could  not  attain  an  avaerage  of  85  or  higher  you  are  required  to  take 
ExamI  and  ExamII.    You  are  allowed  to  take  the  exams  even  if  took  the  quiz  option  and  scored  above  85,    if 
would like to attain a better grade.  
While  quizzes  will  be  take  home  and  will  be  offered  online,  both      exams  will  be  administered  in  the  class  on  
respective dates indicated in the course schedule. You are allowed to use a four page cheat sheet in both exams.  
Make up exams are available only for officially documented cases. 
          MyFinance Lab Online Quizzes 
          These quizzes are similar to homework assignments posted in MyFinanceLab. While you have unlimited 
          time, you can submit your results only once.  In other words, unlike homework assignments, you may 
          have only one attempt.  The quizzes are not accessible after the due date.  
          In Class Exams: 
          In class exams will be a combination of multiple choice and short problems. You can use a long cheat 
          sheet during the exam, but not your book or your notes.  
Exam1 (or Session Quizzes x 5)                                          30 
Case Write Ups x2                                                       20 
Attandance & Participation1                                             15 
ExanII (or Session Quizzes)                                             35 
Total                                                                  100 

1 Attandance & Participation refers to consistent, consturctive and creative engagement in the class with the instructor and your peers. You are 

expected to make non trivial remarks, bring up interesting issues for discussion and offer clarifying comments to enhance your peer's 
understanding during the class discussions. Quality and substance of your contributions will determine your participation grade.  
95 <       A          6570       C+ 
9095       A          6065       C 
8590       B+         5560       C 
7585       B          5055       D 
7075     B        50>            F 
Academic Honesty Policy 
Students who enroll in courses for credit are expected to attend all classes, take the midterm and final examinations,
and complete all other coursework. If a student is absent from a class meeting for any reason, including registering
late, it is the student's responsibility to make up all work from that class. All work submitted to meet course
requirements is expected to be the student's own work. A student suspected of academic dishonesty in any form is
subject to review and disciplinary action by the Summer School Administrative Board. Disciplinary action may
include, but is not limited to, required withdrawal from the course and/or required withdrawal from the Summer
School. Summer School regulations regarding academic honesty are discussed in detail in the Summer School
student handbook.
January 26th  Session1: Introduction 
                 Required Readings: 
                     Gitman  Chp 1  

                      My Finance Lab Session1 HW 

February 2nd     Session2: Financial Statements and AnalysisAn Overview 
                 Topics Covered: 
                      Key components of the stockholders' report: the income statement, 
                         balance sheet,  
                         statement of retained earnings, and the statement of cash flows.  
                      Evaluation of financial statements using ratio analysis. Liquidity, 
                         Activity, Debt,  
                         Profitability and Market Ratios.  
                      DuPont Analysis  
                 Required Readings 
                      Gitman Chp 2  
                      MyFinance Lab Session2 HW (Due on Feb 9th) 
                      MyFinance Lab Session2 Quiz (Due on Feb 9th  ) 
February 9th     Session3: Financial Planning  
                 Topics Covered 
                     Cash Budget 
                     Pro forma income and balance sheet 
                     Operating cash flow and Free Cash Flow Depreciation of assets  
                     Sources and uses of cash and statement of cash flows  
                 Required Readings 
                     Gitman Chp 3 

                      MyFinance Lab Sesion3 HW 

                        MyFinance Lab Session3 Quiz 

                        Chp 3 Spreadsheet Exercise (do not submit) 

February 16th   President's Day No Class  
February 23rd  Session4: Time Value of Money;  
                 Topics Covered 
                     The PV and FV of a sum 

                        The present and future values of an annuity
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