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itures Machinery Buildings Land Equipment Information Systems Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1922 4 What are the main sources and costs of unsecured and secured shortterm financing? Learning Goal 4 Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1926 How do the two primary sources of longterm financing pare? 5 Learning Goal 5 Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1930 7 When and how do firms issue equity, and what are the costs? Learning Goal 7 Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1933 Making Use of Leverage Common Stock $ 30,000 Bonds (10%) $200,000 Funds Raised $230,000 Earnings $ 35,000 Less: Bond Interest $ 20,000 Total Earnings $ 15,000 Return to $15,000 Stockholders $30,000 Common Stock $230,000 Bonds (10%) 0 Funds Raised $230,000 Earnings $ 35,000 Less: Bond Interest $ 20,000 Total Earnings $ 15,000 Return to $35,000 Stockholders $230,000 = = 50% Leverage Selling Bonds = = % Equity Sale of Stock Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1937 9 What is risk and how can it be managed? What makes a risk insurable? Learning Goal 9 Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1941 10 Life Health Liability Property Types of Insurance Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1939 10 What types of insurance coverage should businesses consider? Learning Goal 10 Chapter 19 Understanding Business Luan Ling Eamp。M School, CAU 1935 8 ? Work with top management to develop and implement the firm’s strategic direction ? Reestablish public trust ? Assure stakeholders of honest transactions and reporting ? Maintain a higher profile with their panies’ boards The Changing Role of the CFO Chapter 19 Understanding Business Luan Ling