Industrial Engineering (English)
Bachelor	TR-NQF-HE: Level 6	QF-EHEA: First Cycle	EQF-LLL: Level 6

General course introduction information

Course Code:

FNCE301

Course Name:

Business Finance

Course Semester:

Fall

Course Credits:

Theoretical	Practical	Credit	ECTS
3	0	3	6

Language of instruction:

Course Requisites:

Does the Course Require Work Experience?:

Type of course:

Compulsory

Course Level:

Bachelor

TR-NQF-HE:6. Master`s Degree

QF-EHEA:First Cycle

EQF-LLL:6. Master`s Degree

Mode of Delivery:

Face to face

Course Coordinator :

Prof. Dr. GÖKÇE TUNÇ

Course Lecturer(s):

Prof. Dr. GÖKÇE TUNÇ

Course Assistants:

Course Objective and Content

Course Objectives:

The primary objective of this course is to provide students with the tools to understand and solve the basic financial problems confronting business today. Therefore, fundamentals of finance, financial statements analysis, time value of money concepts are taught to develop the theoretical background for students. The successful completion of this course should provide the student with the basic skills that should be used in analyzing alternative business investments. Furthermore the course aims to equip the students in applying the theory of corporate finance in corporate financial decision-makings.

Course Content:

The Role of Managerial Finance and The Financial Market Environment
Financial Statements and Ratio Analysis
Cash Flow and Financial Planning
Time Value of Money
Interest Rates and Bond Valuation

Learning Outcomes

The students who have succeeded in this course;

Learning Outcomes

1 - Knowledge
Theoretical - Conceptual
1) 2.1) • Explain and analyze the financial statements of a corporation to evaluate the financial performance of the firm. 2.2) • Compute the market value of financial assets such as bonds and stocks.
2) 3.1) • Recognize the financial planning process, including long-term (strategic) and short-term (operating) financial plans.
3) • Discuss the role of time value of money in finance and calculate the future and present values of different types of cash flows for determining value of various investment alternatives
2 - Skills
Cognitive - Practical
3 - Competences
Communication and Social Competence
Learning Competence
Field Specific Competence
Competence to Work Independently and Take Responsibility

Lesson Plan

Week	Subject	Related Preparation
1)	• Describe the course. • Explain the basic types of financial management decisions and the role of the financial manager. • Explain the goal of financial management. • Recognize the financial implications of the different forms of business organization. • Define value creation as the most fundamental aspect of management and describes agency issues that can arise. • Recognize real-world issues concerning conflict of interest and current controversies surrounding ethical conduct and management pay. • Up-to-date discussion of Sarbanes-Oxley and its implications and impact. • Examine the choice of organization form for a small business.	Review the Syllabus.
2)	• Define the balance sheet and income statement. • Define cash flow and spells out the differences between cash flow and earnings. • Recognize the relevance of market values over book values. • Explain the variation in corporate tax rates across industries in practice. • Identify the key cash flow concepts in a small business setting. • Explain Balance sheet and Income Statement.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 1-2. Review the Lecture Notes.
3)	• Recognize Cash Flows and Financial Statements • Identify the sources and uses of cash. • Recognize the statement of cash flows. • Explain Standardized Financial Statements • Identify the evaluation of financial statements: Ratio Analysis • Identify Sources vs Uses of Cash • Recognize Common-size financial statements. • Discuss Short-Term Solvency, or Liquidity, Measures • Discuss Long-Term Solvency Measures • Discuss Asset Management, or Turnover, Measures • Discuss Profitability Measures	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 1-2. Review the Lecture Notes.
4)	• Define enterprise value (EV) and discusses the widely used EV–EBITDA ratio. • Explain the basic DuPont equation to better explore the interrelation ships between operating and financial performance. • Analyze how to get and use real-world data thereby applying key chapter ideas. • Explain how to evaluate financial statements. • Illustrate the use of ratios and some pitfalls in a small business context. • Recognize Market Value Measures • Discuss Expanded DuPont analysis. • Justify Expanded DuPont analysis using data from S&P Market Insight. • Discuss The enterprise value–EBITDA ratio. • Minicase: Ratio Analysis at S&S Air, Inc.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 3. Review the Lecture Notes.
5)	• Define the percentage of sales approach to creating pro forma statements. • Discuss the importance of financial plan and capacity utilization for a small business. • Recognize a vehicle for examining the interrelationships between operations, financing, and growth. • Explanation of growth rate formulas clears up a common misunderstanding about these formulas and the circumstances under which alternative formulas are correct. • Illustrate the importance of financial planning in a small firm. • Recognize the percentage of sales method. • Compute the external financing needed to fund a firm’s growth. • Analyze the determinants of a firm’s growth. • Analyze some of the problems in planning for growth. • Justify the expanded discussion of sustainable growth calculations. • Discuss the alternative formulas for sustainable and internal growth rates.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 3. Review the Lecture Notes.
6)	• Determine the future value of an investment made of an investment made today. • Determine the present value of cash to be received at a future date. • Analyse the relationship between present value and future value. • Find the return on an investment. • Compute how long it takes for an investment to reach a desired value.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 4. Review the Lecture Notes.
7)	• How to determine the future and present value of investments with multiple cash flows. • Calculate Effective Annual Rate (EAR) and Annual Percentage Rate (APR). • Define loan types and loan amortization • Find the interest rate on a loan. • Recognize how loans are amortized or paid off. • Recognize how interest rates are quoted (and misquoted).	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 4. Review the Lecture Notes.
8)	• Midterm Exam • Discuss the Midterm Exam. • Explaining the specifics of the Midterm Exam.	Review the Lecture Notes.
9)	• Explain bond features and prices. • Explain bond values and yields and analyze why they fluctuate. • Recognize interest rate risk. • Find yield to maturity of a bond. • Explain bond ratings and what they mean.	Review the Lecture Notes.
9)	• Explain bond features and prices. • Explain bond values and yields and analyze why they fluctuate. • Recognize interest rate risk. • Find yield to maturity of a bond. • Explain bond ratings and what they mean.	Review the Lecture Notes.
10)	• Define important types of bonds. • Discuss the issues that come up in selling bonds to the public. • Recognize the impact of inflation on interest rates. • Compute the term structure of interest rates and analyze the determinants of bond yields. • Discuss real versus nominal rates and the determinants of the term structure. • Explan the pricing of bonds between coupon payment dates and also bond market quoting conventions. • Discuss a relatively new type of call provision that has become very common.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 5. Review the Lecture Notes.
11)	• Analyze the constant and non-constant growth models. • Differentiate types of stocks. • Discuss the major stock market operations. • Evaluate PE and price/sales ratios for equity valuation. • Illustrate the difficulties and issues surrounding small business valuation.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 5. Review the Lecture Notes.
12)	• Discuss the capital budgeting. • Define the net present value (NPV) criterion. • Recognize the specifics of NPV criterion. • Explain the payback rule and some of its shortcomings. • Discuss the discounted payback rule and some of its shortcomings. • Evaluate the accounting rates of return and some of the problems with them.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 6. Review the Lecture Notes.
13)	• Define Internal Rate of Return (IRR) criterion. • Recognize the specifics of IRR criterion. • Define Modified-Internal Rate of Return (MIRR) criterion. • Recognize the specifics of MIRR criterion. • Explain the Profitability Index criterion. • Identify the reasons why the NPV criterion is the best way to evaluate proposed investments.	Read in Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (Pearson – Sixteenth Edition) Chapter 6. Review the Lecture Notes.
14)	• Review: Identify the sources and uses of cash. • Review: Explain the basic DuPont equation to better explore the interrelation ships between operating and financial performance. • Review: Explain bond values and yields and analyze why they fluctuate. • Review: Recognize interest rate risk. • Analyze the constant and non-constant growth models. • Recognize the specifics of NPV criterion. • Recognize the specifics of IRR criterion. • Recognize the specifics of MIRR criterion.	Review the Lecture Notes.
15)	• Evaluate students via final exam. • Assess the student’s performance throughout the semester. • Analyze the final exam results in terms of further amelioration of the course.	Review the course topics.

Sources

Course Notes / Textbooks:	Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (published by Pearson – Sixteenth Edition). REFERENCE BOOKS AND JOURNALS: RELATED WEB PAGES: Business Week www.businessweek.com Fortune www.fortune.com Forbes www.forbes.com Financial Times www.ft.com, www.usa.ft.com Wall Street Journal www.wsj.com
References:	Principles of Managerial Finance, by Lawrence J. Gitman and Chad J. Zutter (published by Pearson – Sixteenth Edition). REFERENCE BOOKS AND JOURNALS: RELATED WEB PAGES: Business Week www.businessweek.com Fortune www.fortune.com Forbes www.forbes.com Financial Times www.ft.com, www.usa.ft.com Wall Street Journal www.wsj.com

Course-Program Learning Outcome Relationship

Learning Outcomes			3
Program Outcomes
1) Adequate knowledge in mathematics, science and engineering subjects pertaining to the relevant discipline; ability to use theoretical and applied information in these areas to model and solve engineering problems.
2) Ability to identify, formulate, and solve complex engineering problems; ability to select and apply proper analysis and modelling methods for this purpose.
3) Ability to design a complex system, process, device or product under realistic constraints and conditions, in such a way so as to meet the desired result; ability to apply modern design methods for this purpose. (Realistic constraints and conditions may include factors such as economic and environmental issues, sustainability, manufacturability, ethics, health, safety issues, and social and political issues according to the nature of the design.)
4) Ability to devise, select, and use modern techniques and tools needed for engineering practice; ability to employ information technologies effectively.
5) Ability to design and conduct experiments, gather data, analyse and interpret results for investigating engineering problems.
6) Ability to work efficiently in intra-disciplinary and multi-disciplinary teams; ability to work individually.
7) Ability to communicate effectively i Turkish, both orally and in writing; knowledge of a minimum of one foreign language.
8) Recognition of the need for lifelong learning; ability to access information, to follow developments in science and technology, and to continue to educate him/herself.
9) Awareness of professional and ethical responsibility.
10) Information about business life practices such as project management, risk management, and change management; awareness of entrepreneurship, innovation, and sustainable development.
11) Knowledge about contemporary issues and the global and societal effects of engineering practices on health, environment, and safety; awareness of the legal consequences of engineering solutions.

Course - Learning Outcome Relationship

No Effect	1 Lowest	2 Low	3 Average	4 High	5 Highest

	Program Outcomes	Level of Contribution
1)	Adequate knowledge in mathematics, science and engineering subjects pertaining to the relevant discipline; ability to use theoretical and applied information in these areas to model and solve engineering problems.
2)	Ability to identify, formulate, and solve complex engineering problems; ability to select and apply proper analysis and modelling methods for this purpose.
3)	Ability to design a complex system, process, device or product under realistic constraints and conditions, in such a way so as to meet the desired result; ability to apply modern design methods for this purpose. (Realistic constraints and conditions may include factors such as economic and environmental issues, sustainability, manufacturability, ethics, health, safety issues, and social and political issues according to the nature of the design.)
4)	Ability to devise, select, and use modern techniques and tools needed for engineering practice; ability to employ information technologies effectively.
5)	Ability to design and conduct experiments, gather data, analyse and interpret results for investigating engineering problems.
6)	Ability to work efficiently in intra-disciplinary and multi-disciplinary teams; ability to work individually.
7)	Ability to communicate effectively i Turkish, both orally and in writing; knowledge of a minimum of one foreign language.
8)	Recognition of the need for lifelong learning; ability to access information, to follow developments in science and technology, and to continue to educate him/herself.
9)	Awareness of professional and ethical responsibility.
10)	Information about business life practices such as project management, risk management, and change management; awareness of entrepreneurship, innovation, and sustainable development.
11)	Knowledge about contemporary issues and the global and societal effects of engineering practices on health, environment, and safety; awareness of the legal consequences of engineering solutions.

Learning Activity and Teaching Methods

Field Study
Lesson
Group study and homework
Homework
Project preparation

Assessment & Grading Methods and Criteria

Written Exam (Open-ended questions, multiple choice, true-false, matching, fill in the blanks, sequencing)
Oral Examination
Individual Project

Assessment & Grading

Semester Requirements	Number of Activities	Level of Contribution
Midterms	1	% 40
Final	1	% 60
total		% 100
PERCENTAGE OF SEMESTER WORK		% 40
PERCENTAGE OF FINAL WORK		% 60
total		% 100

Workload and ECTS Credit Grading

Activities	Number of Activities	Workload
Course Hours	16	48
Study Hours Out of Class	16	64
Project	1	12
Homework Assignments	5	10
Quizzes	4	2
Midterms	1	15
Final	1	22
Total Workload		173