Contemporary Financial Management, 13th Edition

  • includes Thomson ONE - Business School Edition 6-Month Printed Access Card
  • R. Charles Moyer University of Louisville
  • James R. McGuigan
  • Ramesh P. Rao Oklahoma State University
  • ISBN-10: 1285198840  |  ISBN-13: 9781285198842
  • 960 Pages
  • Previous Editions: 2012, 2009, 2006
  • © 2015 | Published
  • List Price = $ 359.95
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This successful text provides a comprehensive and contemporary introduction to financial management, focusing on value creation, risk management, and effectively managing cash flows, the international aspects of financial management, the ethical context of managerial decision-making, and the increased impact of the Internet in business practice. Content has been added or enhanced to reflect the effects of the 2008-2009 recession on companies and investors.

Features and Benefits

  • Chapter learning objectives and references (footnotes and web references) have been updated in all chapters throughout the book.
  • CHAPTER-OPENING FINANCIAL CHALLENGES: Many chapters in this edition include new, current "Financial Challenges" chapter-opening scenarios that capture some of the most challenging scenarios in today's field to direct students' attention toward the chapter concepts.
  • FOUNDATION CONCEPTS HIGHLIGHT VITAL CONTENT: Unique "Foundation Concepts" icons clearly identify the finance concepts within each chapter that are most vital for students to know.
  • INTEGRATIVE CASES THAT WORK WITH EXCEL®: At the end of appropriate chapters, a set of comprehensive Integrative Cases provides important hands-on applications. Many of them can be used with the Excel® templates on the Web site as students learn the power of computers in performing sensitivity analysis.
  • ETHICS, INTERNATIONAL, AND ENTREPRENEURIAL ISSUES ARE ADDRESSED: Unique "Ethical Issues" boxes raise sensitivity to ethical challenges facing managers and often prompt class discussion. "International Issues" illustrate global considerations necessary to making financial decisions. "Entrepreneurial Issues" emphasize unique finance-related problems and concerns of today's entrepreneur.
  • THOMSON-ONE BUSINESS SCHOOL EDITION IS INCLUDED WITH THE TEXT: Motivate students to perform basic research and analysis with Thomson ONE-BSE online financial database, the same tool that professional brokers and analysts around the world use every day. Students can access leading financial data sources, including Thomson Financial, Worldscope, SEC Disclosure, Datastream, and more, as they complete special Thomson ONE-BSE end-of-chapter problems in the text.
  • APLIA FOR FINANCE: An online learning solution that increases student effort and engagement and minimizes instructor time spent on manual grading and class administration. Assignments are written specifically for each text by content experts. Interactive chapter assignments, tutorials, and news analyses makes finance relevant and engaging. Students receive immediate, detailed explanations for every answer. Preparing for Finance tutorials help students overcome deficiencies in mathematics, statistics, accounting, and economics.

Table of Contents

1. The Role and Objective of Financial Management.
2. The Domestic and International Financial Marketplace.
3. Evaluation of Financial Performance.
4. Financial Planning and Forecasting.
5. The Time Value of Money.
6. Fixed Income Securities: Characteristics and Valuation.
7. Common Stock: Characteristics, Valuation, and Issuance.
8. Analysis of Risk and Return.
9. Capital Budgeting and Cash Flow Analysis.
10. Capital Budgeting: Decision Criteria and Real Option Considerations.
11. Capital Budgeting and Risk.
12. The Cost of Capital.
13. Capital Structure Concepts.
14. Capital Structure Management in Practice.
15. Dividend Policy.
16. Working Capital Policy and Short-Term Financing.
17. The Management of Cash and Marketable Securities.
18. The Management of Accounts Receivable and Inventories.
20. Financing with Derivatives.
21. Risk Management.
22. International Financial Management.
23. Corporate Restructuring.
Appendix 2A: Taxes.
Appendix 5A: Continuous Compounding and Discounting.
Appendix 9A: Depreciation.
Appendix 10A: Mutually Exclusive Investments Having Unequal Lives.
Appendix 14A: Breakeven Analysis.
Appendix 20A: The Black-Scholes Option Pricing Model.
Appendix 20B: Bond Refunding Analysis.

What's New

  • New! Cengage Learning Testing Powered by Cognero is a flexible, online system that allows you to: author, edit, and manage test bank content from multiple Cengage Learning solutions; create multiple test versions in an instant; deliver tests from your LMS, your classroom or wherever you want. Cognero Testing Software is an easy-to-use computerized testing program containing all of the questions in the test bank offering more than 1,800 multiple-choice questions and problems. This unique test bank is designed with the instructor in mind, and includes AACSB designations for each question and problem.
  • Many chapters in this edition include new, current "Financial Challenges" opening scenarios: Apple's Stock Prices (Ch. 3); Pension Obligations and the Interest Rate (Ch. 5); Cheap Money (Ch. 6); Facebook's Troubled IPO (Ch. 7); Investment Diversification and Risk (Ch. 8); Betting Big on the Boeing 787 Dreamliner (Ch. 9); How GM is Dealing with its Debt (Ch. 13); High-Tech Companies' Love Affair With Debt (Ch. 14); ILFC's Risky Financial Strategy (Ch. 16); Hunting for "Elephants" (Ch. 17); Hedging and Hershey's Sweet Success (Ch. 21); and Lexus Comes to the U.S. (Ch. 22).
  • Chapter 1 - Updated and expanded the financial challenge, including information on Apple's record debt offering, clarification of stakeholder vs shareholder goals, and updates of real world examples throughout.
  • Chapter 2 - Updated and expanded the financial challenge to include the MF Global collapse. Discussion of the challenges to the viability of the euro.
  • Chapter 3 - New Financial Challenge about Apple's stock price performance; addition of a new financial ratio -- enterprise value/EBITDA, and discussion of its interpretation. New examples illustrating various ratios and earnings management including Google, Yahoo, Apple, Diamond Foods, Hewlett-Packard, Citicorp, FedEx, and UPS.
  • Chapter 4 - New statement of cash flow illustration using Starbucks Corporation and updated discussion of bankruptcy prediction models.
  • Chapter 5 – New Financial Challenge related to pension liabilities and funding.
  • Chapter 6 – New Financial Challenge dealing with debt offering strategies in a low interest rate environment.
  • Chapter 7 – New Financial Challenge – Facebook's IPO; updated data and examples throughout.
  • Chapter 8 – New Financial Challenge dealing with investment diversification and risk; updated data and examples throughout, including latest equity risk premium data.
  • Chapter 9 – New Financial Challenge – Poland's national airline LOT and the Boeing 787.
  • Chapter 10 - Revised and updated Financial Challenge – Boeing vs Airbus; removed section dealing with inflation and capital expenditures.
  • Chapter 11 – New Financial Challenge dealing with the risk in the pharmaceutical industry.
  • Chapter 12 – New Financial Challenge dealing with the cost of capital for SourceGas Distribution; new international issues section dealing with market risk premiums around the world.
  • Chapter 13 – New Financial Challenge regarding GM's debt management. Updated examples to illustrate various sources of business risk. More streamlined discussion of Modigliana-Miller capital structure theory. A new example concerning the acquisition of Heinz by Berkshire Hathaway and a private equity group--to illustrate the agency problem of debt.
  • Chapter 14 – New Financial Challenge on high tech firms and debt. Updated information on debt ratios for various industries, and rating standards.
  • Chapter 15 - Data and tables have been updated extensively. Tax effects of dividend policy updated to include the effects of the American Taxpayer Rights Act of 2012 that takes effect in 2013. Updated data on dividend payout ratios for various industries. More detailed coverage of agency costs of dividends and examples including Apple. Added/updated examples of various aspects of dividend policy--Monster, Pepsi, and CVS Caremark. More discussion on stock repurchases, and new references to literature.
  • Chapter 16 – New Financial Challenge on International Lease Financing Corporation's risky financial strategy; new ethical issue – LIBOR rate manipulations.
  • Chapter 17 – New Financial Challenge on Berkshire–Hathaway's cash balances.
  • Chapter 18 – New Financial Challenge on Boeing's working capital problem and the 787 Dreamliner; a discussion of the impact of Japan's tsunami on supply chain management around the world.
  • Chapter 19 – Updated Financial Challenge, along with updated data and examples throughout the chapter.
  • Chapter 20 – New Financial Challenge on JP Morgan Chase's derivative losses.
  • Chapter 21 – New Financial Challenge on Hershey's management of commodity costs. Hedging illustrations have been updated with current price information.
  • Chapter 22 – New Financial Challenge on Lexus' US plant location decision.
  • Chapter 23 – New tables showing annual merger volume and the latest mergers. A better description of vertical mergers using Arcellor-Mittal as an example. An updated table on the largest bankruptcy filings.
  • Chapter learning objectives and references (footnotes and web references) have been updated in all chapters throughout the book.

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Meet the Author

Author Bio

R. Charles Moyer

Charles Moyer is Professor of Finance and Entrepreneurship and Dean Emeritus of the College of Business at the University of Louisville, earned his BA in Economics from Howard University and his MBA and PhD in Finance and Managerial Economics from the University of Pittsburgh. Professor Moyer is Dean Emeritus and former holder of the GMAC Insurance Chair in Finance at the Babcock Graduate School of Management, Wake Forest University. He also has taught at the University of Houston, Lehigh University, and the University of New Mexico and spent a year at the Federal Reserve Bank of Cleveland and a year at the Department of Commerce in Washington. Professor Moyer has taught extensively abroad in Germany, France, and Russia. In addition to this text, Moyer has coauthored Managerial Economics, 13th edition (Cengage-South-Western, 2014). He has been published in many leading journals, is a member of the Board of Directors of Summit Biosciences, Capitala, and the Kentucky Seed Capital Fund. He has supplied cost of capital testimony in nearly 100 public utility rate cases.

James R. McGuigan

James R. McGuigan owns and operates his own numismatic investment firm. Prior to this business, he was Associate Professor of Finance and Business Economics in the School of Business Administration at Wayne State University. He also taught at the University of Pittsburgh and Point Park College. Dr. McGuigan received his undergraduate degree from Carnegie-Mellon University; his M.B.A. at the Graduate School of Business at the University of Chicago and his Ph.D. from the University of Pittsburgh. In addition to his interests in economics, he has co-authored several well-known books on financial management.

Ramesh P. Rao

Dr. Ramesh P. Rao is a professor and holds the Paul C. Wise Chair of Finance in the William S. Spears School of Business, Oklahoma State University. He earned a B.S. at the University of the Philippines, M.B.A. from the Asian Institute of Management and Ph.D. from Texas Tech University. He has coauthored over 60 journal articles in publications such as Journal of Business, Journal of Finance, Journal of Banking and Finance, Financial Management, and others. Rao’s research interests focus on mainstream corporate finance issues including compensation and board structure, corporate control, capital and ownership structure, information signaling and related areas. Rao was former program chair and president of the Southwestern Finance Association, and is also the coeditor of the Journal of Applied Finance, and a director of the Asian Finance Association. He has been recognized for his teaching and research excellence including the following awards: 2009 Southwestern Finance Association Best Paper in Corporate Finance Award, Richard W. Poole Research Excellence Award (2008-2009), Chandler-Frates & Reitz Teaching Excellence Award-MBA Program (OSU-Tulsa campus, 2008), Regents Distinguished Research Award (2007), and others.