D364 is the Financial Management I course in WGU's Bachelor of Science in Finance (3 competency units, eighth term).
The program guide says it covers basic financial management principles aimed at the operations side of a business, including managing cash and current assets, cash budgeting and strategic planning.
It reviews the DuPont equation as a way to analyze and improve performance and introduces forecasting models and financial instruments for the working capital portfolio. Corporate Finance is the listed prerequisite, so you are expected to bring time value of money and basic valuation with you.
Course at a Glance
| Item | Details |
|---|---|
| University | Western Governors University (WGU) |
| Course | D364 Financial Management I |
| Program | Bachelor of Science, Finance |
| Credit | 3 competency units |
| Prerequisite | Corporate Finance (program guide) |
| Subject area | Working capital and operational finance |
What D364 Covers
| Competency (summarized) | What it involves |
|---|---|
| Sources and uses of working capital to build a cash budget | Forecasting receipts and payments, spotting shortfalls |
| Cash management in purchasing, inventory and receivables to ensure solvency | Credit terms, collection, inventory levels, payables timing |
| Optimizing an investment portfolio with models and instruments | Short-term investment choices, risk and return |
Key Concepts Explained
The Cash Budget
A cash budget lays out expected cash in and out period by period, so management sees surpluses and shortfalls before they happen.
Example: Opening cash is $20,000. Expected collections are $60,000 and payments $72,000. Ending cash is 20,000 + 60,000 - 72,000 = $8,000. If the company wants a $15,000 minimum balance, it needs to borrow or delay $7,000 of payments.
Working Capital Ratios
The current ratio is current assets divided by current liabilities. The quick ratio removes inventory. Receivables turnover is credit sales divided by average receivables, and days sales outstanding is 365 divided by turnover.
The DuPont Equation
Return on equity breaks into net profit margin x asset turnover x equity multiplier. It shows whether performance comes from profitability, efficient use of assets or leverage.
Example: Margin 5 percent, asset turnover 2.0 and equity multiplier 1.5 give ROE = 0.05 x 2.0 x 1.5 = 15 percent. Raising turnover to 2.2 lifts ROE to 16.5 percent without changing profit margin.
Typical Assignments and How to Approach Them
| Assignment type | What it tests | How to approach it |
|---|---|---|
| Cash budget build | Forecasting sources and uses | Use a clear template and label every assumption |
| Ratio and DuPont analysis | Interpreting performance | Calculate, compare to a benchmark, explain the driver |
| Receivables and inventory policy | Cost and benefit of credit terms | Weigh carrying cost against lost sales |
| Investment portfolio recommendation | Applying models and instruments | Match instruments to liquidity and risk needs |
Receivables, Inventory and Payables Policy
The second competency asks you to apply cash management strategies to purchasing, inventory and receivables. Each is a trade-off between tying up cash and protecting sales.
| Area | Looser policy | Tighter policy |
|---|---|---|
| Receivables | Longer credit terms: more sales, slower cash, more bad debt | Shorter terms: faster cash, risk of losing customers |
| Inventory | Higher stock: fewer stockouts, higher carrying cost | Lower stock: less cash tied up, risk of lost sales |
| Payables | Pay late: more cash held, supplier strain | Pay early: good relationships, less cash |
A strong answer quantifies where possible. If days sales outstanding falls from 50 to 40 days on $3,650,000 of annual credit sales, receivables drop by about $100,000, freeing that cash. Then weigh any cost, such as lost customers or early payment discounts.
Short-Term Investments and Financial Instruments
The third competency covers optimizing an investment portfolio with models and instruments. In a working capital setting the aim is to earn something on spare cash without risking liquidity.
| Instrument | Liquidity | Typical consideration |
|---|---|---|
| Bank deposits | High | Low return, very low risk |
| Money market funds | High | Slightly higher return, small risk |
| Treasury bills | High | Low credit risk, fixed maturity |
| Commercial paper | Medium | Higher yield, issuer credit risk |
Match instruments to the cash budget: money needed within weeks belongs in the most liquid options, while a predictable surplus can use slightly longer maturities. State your risk limits clearly and explain what would trigger a review.
Where Students Get Stuck
- Timing errors. Cash is counted when received or paid, not when sales are made.
- Mixing profit and cash. Depreciation reduces profit but is not a cash outflow.
- Reading ratios in isolation. Always compare with a benchmark or trend.
- Weak interpretation. A figure needs a sentence saying what it means for management.
Study Tips for D364
- Build the cash budget in a spreadsheet so assumptions can be changed.
- Practice explaining each ratio in one sentence to a non-finance manager.
- Review the time value of money from D362 before the investment section.
- Check that opening plus receipts less payments equals closing in every period.
How We Help with D364
Send the task, data and rubric. A finance writer can explain the budgeting and DuPont logic, produce a worked example with a similar structure or review your spreadsheet and commentary. See also our finance assignment help guide.
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Master D364 Cash Budgeting
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Frequently Asked Questions
Working capital management: cash budgeting, cash and current asset management, the DuPont equation and short-term investment tools.
The program guide lists Corporate Finance.
Calculations are central, but interpretation is what separates strong answers.
ROE = net profit margin x asset turnover x equity multiplier.
D364 focuses on short-term operational finance; D365 covers long-term capital budgeting and funding.
Yes. We review the structure, timing and arithmetic and explain any problems.