American University of Madaba

AUM
Faculty of Business and Finance
Department of Banking and Finance
Course Syllabus
Spring Semester 2017-2018

1. Course Specifics

Course Title Principles of Finance 2

Course Number: 0503211
Course Prerequisite(s) 503101
Course Co-requisite(s) None
Credit Hours Lecture: 3 CH - Lab: 0 CH
Lecture Days & Time TT 8:30-10
Class Location BB-G14
Course Instructor/s Dr. Naser Najjar
Syllabus Approved by:
b. Academic Committee
a. Department Chair Dr. Fouzan Al qaisi

2. Academic Staff Specifics

Name Academic Office Number, Office Hours E-mail Address
Rank Location and Tel.
Ext.
Naser Najjar Ass. Professor Business Building MW 11:30-1 n.najjar@aum.edu.jo
2nd Floor TT 10-11:30
F15

3. Course Components

Resources:
 Text book:
Title: Principles of Managerial Finance, 14th Edition.
Author: LawrenceJ. Gitman, and ChadJ. Zutter
Publisher: Pearson

 References:
Scott, B. & Brigham, E. F., Essential of Managerial Finance, 13th edition, Thomson South – Western

Title: Fundamentals of Corporate Finance MEE

Author: Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan,
Publisher: McGraw Hill

 On line Resources:

Amman Stock Exchange www.ASE.com.jo

Jordan central Bank http://www.cbj.gov.jo/

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 American University of Madaba

AUM
Faculty of Business and Finance
Department of Banking and Finance
Course Syllabus
Spring Semester 2017-2018

Course Description:
This course provides an overview of basic principles and theoretical framework prominent
to sound financial management decisions. The course deals with term structure of interest rates,
bond valuation, preferred and common stock valuation and cost of capital. In addition, capital
budgeting techniques and risk refinements in capital budgeting involved to evaluate investment
projects. This type of information is important as it conveys to us the financial health of a business
and the process of looking ahead and anticipating the future. On the other hand, this course allows
dealing with topics such as time value of money, and the management of working capital.
Course General Objectives:

The primary objective of this course is to introduce students to the concepts of bond,
preferred and common stock valuation and building their ability to explain the different basic
models to assess firm value. Also, students should demonstrate understanding of the cost of capital,
capital budgeting decisions, and the risk involve in these decisions. In addition, the student should
be able to deal with the management of working capital. Finally, the student must be able to gain a
working knowledge of the concepts explained during the lectures.
Course Intended Learning Outcomes (ILOs)/Competencies:
A) Knowledge and understanding:
 Understand the concepts and notions of Financial management.
 Understand the concept of bond and stock valuation.
 Understand the concept of the cost of capital.
 Understand the concept of capital budgeting.
 Understand the concept of risk involved in capital budgeting decisions.
 Understand the management of working capital.
B) Cognitive and intellectual skills (thinking and analysis):

 Be able to interpret the valuation models of bond and stocks.

 Be able to evaluate investment opportunities
 Be able to determine each type of the cost of capital.
 Be able to Identify and organize the methods for evaluating capital investment decisions,
and the risk associated with these decisions.

C) Communication skills (personal and academic):

 Be able to provide clear Idea about the firm current and future financial position.
 Be able to provide the right conclusions about the specific projects at the right time.
 Be able to present the Strengths and weakness points for any firm based on the fundamental
analysis tools.
D) Professional Skills:
Upon successful completion of the course, students should be able to:
 Understand basic finance concepts, such as the time value of money, the cost of capital,
capital budgeting, and the management of working capital.
 Measure the value of the firm by using bond and stock valuation models.
 Evaluate various capital budgeting alternatives using Net Present Value and other
Investment Criteria.
 Compute the valuations for investment alternatives using various techniques (algebra,
financial calculators, Tables..Etc.)
 Explain the problems associated with the alternative approaches to asset valuations.

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 American University of Madaba

AUM
Faculty of Business and Finance
Department of Banking and Finance
Course Syllabus
Spring Semester 2017-2018

E) Practical and subject specific skills (Transferable Skills):

 Explain the problems of time value of money and alternative approaches to asset valuations.
 Explain the problems facing each type of the cost of capital.
 Estimate the risk involved in capital budgeting techniques.

Course Intended Learning Outcomes and its Relation with Program Outcomes (PO's *):

PO1 PO2 PO3 PO4 PO5 PO6 PO7 PO8 PO9

A1, A2, B1, C1,D4 x x x

A3, A6,A7, C2,C3,

x x
D1,E2
B3, C6,D4, C4,C5,
x x X
D3,E3
A3, A6,A7, C2,C6,
x X
D2,E4
A4, B2,B4, C10,C3,
x x
D1,E2
A3, A6,C7, C8,C3,
x x
D5

A7, B6, C9, E5,E6 x x x

*Programs Outcomes (PO's) are available at the academic department.

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 American University of Madaba

AUM
Faculty of Business and Finance
Department of Banking and Finance
Course Syllabus
Spring Semester 2017-2018

Teaching Methods:
The structure of this course is elaborated throughout lectures, classroom debates, assignments,
exercises, and homework and projects.

Assessment Instruments
Mark
Midterm Exam 30%
Project Exam 20%
Quizzes, Homework and Participation 10%

Final Exam 40%

Total 100%
Course Academic Calendar

Resources Homework/reports
Week Basic and support material to be covered
and their due dates
1 An Overview of Managerial Finance Principles of
Managerial
Finance

2 and 3 Cost of capital: overview of the cost of capital; Principles of

cost of long-term debt; cost of preferred stock; Managerial
cost of common stock, and the weighted Finance
average cost of capital.
4 and 5 Leverage and Capital Structure Principles of
Managerial
Finance
6 FIRST EXAM
7 and 8 Dividends and Payout Policy Principles of
Managerial
Finance
9 and 10 Capital Budgeting Techniques: overview of Principles of
capital budgeting; payback period; net Managerial
present value, internal rate of return, and Finance
comparing NPV and IRR.
11 SECOND EXAM
12 and 13 Principles of
Working Capital and Current Assets
Managerial
Management
Finance

13 and 14 Working Capital and Current Liabilities Principles of

Management Managerial
Finance

15 Review & Project Presentations

16 FINAL EXAM

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 American University of Madaba

AUM
Faculty of Business and Finance
Department of Banking and Finance
Course Syllabus
Spring Semester 2017-2018

Course Policies
University regulations are applied to this course, regarding class attendance; punctuality, exams,
late submissions; absence with permission; penalties for cheating; and policies for assignments and
projects – if any. Students should be aware of all these regulations in addition to other regulations
stated and described in the student’s handbook.

General Policies for the Course: students must comply with:

A) Lecture Management
1- Studentsshould behave appropriately during lectures, in order to reflect the good reputation of the
university.
2- Students should grasp the course objectives from the first day of attendance in order to work on
achieving these objectives through the course duration.
3- Faculty members encourage students constantly to get involved in class discussions. Therefore,
students should make use of these discussions in order to enhance their educational experience.
4- Studentsshould not leave classrooms during lectures except for compelling reasons.

B) Scientific Honesty
The university prohibits students from any actions inconsistent with scientific honesty,
including cheating in exams whether by giving or receiving information, or submitting
assignments done by others. In case of breach of this sort, the student will be subject to an
effective university punishment, which he/she should be well aware of.

C) Late Attendance or Absence for Lectures

1- Students attending a lecture more than 10 minutes late will be marked as "late attendant", and
every four late attendances will be count for one day absence.
2- Students attending the lecture more than 20 minutes late will be allowed to enter the classroom
but will be marked as "absent".
3- If absences exceed 15% of the lectures, then the student will be disqualified from the course, and
will get the university zero mark for the course.

D) Absence from exams

1- Absentees from a short test (quiz) will not be allowed for a make-up test.
2- Official excuses for missing any exam must be provided to the lecturer for the appropriate
actions to be taken.
3- Special forms designed for absence from final exams are available at the Admission and
Registration Department. The Dean of the related course must be provided with these forms by
the student within seven days from the date of the missed exam in order to take the appropriate
action.
4- Medical excuses must be signed officially and stamped by the Medical Centre.
5- All make up exams will be given only once during the same semester.
6- Make up for the final exam must be held during the first two weeks of the following semester.
7- No excuse will be accepted in case of failing to attend the makeup exam. There will be no other
chance for another make up exam.

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 American University of Madaba

AUM
Faculty of Business and Finance
Department of Banking and Finance
Course Syllabus
Spring Semester 2017-2018

E) Additional Instructions
1- Cell phones must be turned off during lectures and exams.
2- Students should refer to additional references and do extra reading for the course.
3- Students should submit their assignments within the due time.
4- In case of absence or late registration for the course, the student is fully responsible for the
follow up of the missed lecture.
5- Students are advised to keep copies of their assignments as a reference and record.
6- Objection on final exam result is limited to the specific procedures developed by the university.
Students have to refer to the Department of Admission and Registration to view relevant details.

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