MGT 3062 Lecture Notes - Lecture 1: Cash Flow, Financial Statement, Making Money
Document Summary
Business is primarily concerned with making money (or adding value ) How does a company acquire funds? i. e. purchasing of a new building. As an investor, this is important to understand. Goal of the manager of a publicly held firm. How might they invest in an asset (like building or new technology) What do they cost to do that. Individuals investing in stocks and bonds, neutral funds. Have to understand risk in return relationship. Assets and liabilities are switched in a sense i. e. our checking account is an asset to us, but liability to a bank. Our loan is a liability to us, but an asset to the bank because of interest the bank makes. The person keeps all of the profit but that one person has unlimited liability. Life of the company = life of the owner. Amount of equity is limited to the person"s wealth and contact. When two or more person is involved in a firm.
