Fundamentals of Corporate Finance, 4th Edition

Preface xii

Key features xiv

About the authors xv

Part 1 Introduction and foundations 1

1. The financial manager and the company 2

2. The financial environment and the level of interest rates 25

3. Financial statements, cash flows and tax 48

4. Analysing financial statements 77

Part 2 Valuation of future cash flows and risk 121

5. The time value of money 122

6. Discounted cash flows and valuation 158

7. Risk and return 196

8. Bond valuation and the structure of interest rates 235

9. Share valuation 270

Part 3 Capital budgeting decisions 298

10. The fundamentals of capital budgeting 299

11. Cash flows and capital budgeting 342

12. Evaluating project economics and capital rationing 375

13. The cost of capital 406

Part 4 Working capital management and financing decisions 440

14. Working capital management 441

15. How companies raise capital 473

16. Capital structure policy 499

17. Dividends and dividend policy 531

Part 5 Business formation, valuation and financial planning 550

18. Business formation, growth and valuation 551

19. Strategic financial planning and forecasting 586

Part 6 Options and corporate finance and international decisions 622

20. Options and corporate finance 623

21. International financial management 652

Appendix A: Present value and future value tables 684

Appendix B: Solutions to self-study problems 692

Index 714