656 Index
Net present value (NPV) (Continued)
decision rules other than, 307–311
discounting cash f lows, 300–301
discount rate, 303–307
divisional vs. firm cost of capital, 307
examples, 302–303
leverage effects, 305–307
taxable income and income tax, 296
time value of money, 299 – 301
weighted average cost of capital (WACC),
304–305
windfall profit and windfall tax, 295–296
Network(ing), 164–170, 546 –548. See also
Internet /intranet /extranets
architecture, 164
browsers, 169
client-server, 164, 165
cookies, 169
electronic commerce, 168–169
electronic mail (e-mail), 165–166
file server, 164
firms and, 546 –548
individuals and, 164–170
local area network (LAN), 164
operating system, 164
peer-to-peer, 164
streaming media, 170
wide area network (WAN), 165, 166
wireless modems, 164
World Wide Web, 167–168
Network adapter, 154
Nonrecurring items (gains/losses), 35–71, 90, 91
accounting changes, 51–53
changes in estimates, 53–54
in continuing operations income, 42– 43
discontinued operations, 47– 48, 49
extraordinary items, 47–51
foreign exchange (transaction and translation
exposure), 67– 69
identification process, 39
in income statement, 39–54, 56
in income tax note, 59– 62
in notes to financial statements, 67–71
interpreting information in operating activities
section, 56 –58
in inventory disclosures of LIFO firms, 58–59
located below income from continuing
operations, 46 – 47
in Management’s Discussion and Analysis
(MD&A), 64– 67
nature of, 37–39
operating income (inclusions/exclusions),
43– 46
in “other income and expense” note, 62– 64
quarterly and segmental financial data, 70–71
restructuring notes, 69
search process, 39, 40, 90, 91
in statement of cash f lows, 54–58
Offering, 286
Officers, 243
Olin Corporation, 369
Operating systems, 156
Operations/operating:
consolidated statements of (example), 76
expenses (critical risks section of business
plan), 285
income, 43– 46
nonrecurring items, 43– 46
plan, 278–279, 280
Opportunity costs, 298
Options, 361, 434, 440– 442
Osmonics, 43
“Other comprehensive income,” 71–72
“Other income and expense” note, 62– 64, 90
Overhead, 299Pall Corporation, 62, 359, 373, 405
Partner(s), strategic, 281
Partnership, 226 –227
continuity of life, 234
control, 237–238
formation, 229
liability, 245
limited (see Limited partnership)
pass-through entity, 318
recognition as legal entity, 232–233
taxation, 250
transferability of interest, 236
Passive losses, 320–322
Pass-through entities, 319–320
Pave-Rite Inc., 583
Payback period rule, 308
Peer-to-peer network, 164
Pegasus Systems Inc., 408
Penn Central Corporation, 513
Pension funds, 531–532
Per f or ma nc e :
evaluation (budget function), 176
of foreign subsidiaries/management, 356,
401– 413
Personal digital assistants (PDAs), 149, 151–152
Personal finance software, 161, 162
Philip Morris Companies Inc., 385, 403, 576
Phillips Petroleum, 65–66, 75
Pickens, T. Boone, 577
Pizzi, Denise, 127–148
Planning, 195
budgets and, 175, 178, 291–313 (see also
Budget(s)/budgeting; Capital budgeting)
business plan, 260–290
enterprise resource planning (ERP) systems,
544
estate, 343–347
Polaroid Corporation, 369, 373, 408
Pollo Tropical, 46
Pooling of interests method, 584