ECON 2560 Study Guide - Midterm Guide: Dividend Discount Model, Initial Public Offering, Cash Cash

• School: University of Guelph
• Department: Economics
• Course: ECON 2560
• Professor: Bowr Nancy

Document Summary

Agency problems whe(cid:374) perso(cid:374)al goals (cid:272)o(cid:374)fli(cid:272)t (cid:449)ith those of the (cid:272)orporatio(cid:374). I. e : managers over indulge in unnecessary expenses (i. e. Fancy hotels for business trips: h(cid:455) a(cid:449)a(cid:455) fro(cid:373) risk(cid:455) proje(cid:272)ts so the(cid:455) do(cid:374)"t look (cid:271)ad. International financial reporting standards (ifrs) current financial statements used in canada for domestic listed companies. Current assets most liquid form of assets. Non-current assets assets of an investment nature; tangible or intangible. Current liabilities short term and current portion of long term debts: typically paid off within a year. Non-current liabilities long-term borrowings: t(cid:455)pi(cid:272)all(cid:455) paid off i(cid:374) o(cid:448)er a (cid:455)ear"s ti(cid:373)e. Sha(cid:396)eholde(cid:396)s" e(cid:395)uity difference between total assets and total liabilities. Sha(cid:396)eholde(cid:396)s" e(cid:395)uity = total assets total liabilities. Liquid assets assets easily converted into cash: cash or cash equivalents, accounts receivable, other current assets. Non-current assets unlikely to be turned into cash anytime soon: net fixed assets. Share capital represe(cid:374)ts a(cid:373)ou(cid:374)ts raised fro(cid:373) the sale of a (cid:272)o(cid:373)pa(cid:374)(cid:455)"s share to i(cid:374)(cid:448)estors.