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For your first post, define financial management.

Financial Management is the way a person or corporation or


business manages their money to fulfill or accomplish objectives
in their organization.
What are some other examples of the differences between
financial management and financial accounting?
Financial Management is the way that the CEO and the board
make business decisions that help use their monies to make
money. Financial Accounting helps keep track of how the monies
or the financial transactions are made. It also records,
summarizes and presents all of the reports or financial
statements to the stock holders and board members and CEOs
to help them make the right business decisions.
Give examples.
Financial Management example would be the Financial Manager
ensuring that his or her company invests, provides dividends,
raises capital, budgets, retains profits. He or she will do this by
making the correct decisions based on reports provided by the
Financial accountant.
I guess that the movement of the St. Louis Rams from Missouri
back to Los Angeles was a business decision made based on the
financial statements given to the owners and stock holders.
There is probably more money to be made in Los Angeles. The
decision to build a new stadium in California outweighed the
decision to stay in St. Louis.

For your next post, explain the DuPont identity.


From my research the Dupont identity is a term that breaks down
the return on equity into three parts. Profit margin, total asset
turnover and financial leverage.
http://www.investopedia.com/terms/d/dupontidentity.asp
How is it used in finance?
It allows analysts to understand if a company is weak or strong
financially and if the company assets are generating sales or
cash. It helps identify if that company uses debt to produce
incremental returns.
http://www.investinganswers.com/financial-dictionary/ratioanalysis/dupont-identity-3127
Locate the financial statements for two firms in the same
industry.
Calculate all four terms of the DuPont identity, and present the
results but do not analyze them.
ROE=Profit margin X Asset turnover X Leverage factor
ROE=(Net income/Revenue) X (Revenues/Total assets) X (Total
assets/Shareholders equity)
Home Depot (in millions) Jan 31, 2016
ROE=(7,009/30,265) X (30,265/42,549) X (42,549/6,316)
ROE= .231 X .711 X 6.7
ROE=1.106
Lowes (in millions)
ROE=(2,546/59,074) X (59,074/31,266) X (31,266/7,654)
ROE=.043 X 1.89 X 4.08
ROE=.33

For an additional post, analyze the results that another student


has posted. If you were the appropriate financial manager of one
of the firms that you analyzed, what would be your observations
and recommendations?

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