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[Title]

[Name of the Writer]

[Name of the Institution]

What to learn about Finance?

Finance is a broader field than we think about. Being a business student, I want to learn a lot about finance. But, the two major things that I like to learn about Finance are Financial Management and Financial Decision Making.

Financial Management

I prefer to learn the concept of Financial Management because it would assist me in my personal life as well as in professional life. By having a grip on Financial Management, I would be able to make informed management decisions for the organization where I would be doing job (e.g. Finance Manager). Beyond this, it would also be helpful for me to manage my financial problem in routine life.

Financial Decision Making

The most critical and crucial part of finance is Financial Decision Making. I would like to learn it because I am a student and it will enable me to think economically and to estimate before spending. Additionally, every organization looks for candidates who have the abilities to make productive financial decisions (Candela, 2019). Hence, learning this area of finance will stand me out for the job of Financial Analyst.

Chapter No 1

“A limited partnership is a partnership with two kinds of owners, general partners, and limited partners. General partners have the same rights and privileges as partners in a (general) partnership—they are personally liable for the firm's debt obligations. Limited partners, however, have limited liability—that is, their liability is limited to their investment.”

In the chapter, the above-listed sentence has been found as the most significant one. The sentence has been picked as the most vital because it clarifies the view of the reader, that a limited partnership does not have limited liability for every owner. While there must be some general partners in the limited partnership who are personally liable for the debt obligation of the partnership (Berk, & DeMarzo, 2017). So, if someone (student or even investors) read it, then he/she would have a clear idea that what kind of ownership to select when investing in a particular business (partnership).

“Setting up a corporation is therefore considerably more costly than setting up a sole proprietorship.”

The above sentence has been picked form Chapter 1 of the book as a significant one because it clearly and briefly differentiates Corporation and Sole Proprietorship, based on their setting costs.

Chapter No 2

“The difference between the firm’s assets and liabilities is the stockholders’ equity; it is also called the book value of equity.”

The aforementioned (listed) sentence is one of the most crucial and significant sentences of the chapter. This is significant because it assists the financial analyst in a very clear and easy approach. This states that stockholders’ equity is the difference between assets and liabilities of a business. In other words, the sentence helps the financial or business analyst that simply identify the difference between total assets and total liabilities to extract owners’ equity of a firm (Berk, & DeMarzo, 2017).

“The income statement or statement of financial performance lists the firm's revenues and expenses over some time.”

The sentence is a significant one because it helps that we should analyze Income Statement if we want to know about the financial performance of the company or business. Which means, that the person should go for analyzing Income Statement if he/she is slightly interested to know about financial performance of a business.

References

Berk, J. B., & DeMarzo, P. M. (2017). Corporate Finance: The Core, 4/e. Boston: Pearson Education. ISBN 9780134083278.

Candela, L. (2019). Introducing Finance; Boundless Finance. Courses.lumenlearning.com. Retrieved 2 September 2019, from https://courses.lumenlearning.com/boundless-finance/chapter/introducing-finance/