Business management chapter 15 vocabulary
Net profit
(1)the amount remaining after subtracting All expenses from revenue except taxes (2) the difference between the selling price and all costs and expenses of the business
Capital(net worth,owner's equity,stock Holders equity )
(1)the money required to start or expand a business (2)a measure of the credit applicants current financial worth or ability to pay based on assets(3)the value of the owner's investment in the business after subtracting liabilities from assets
Book value
(1)the value of a share of stock that is found by dividing the net worth (assets minus liabilities ) of the corporation by the total numbers of shares outstanding (2)the value of an asset after deducting the total amount of depreciation from the assets original value
Operating budget
A budget showing projected sales,costs,expenses,and profits for the on going operations of business
Start-up budget
A budget that projects income and expenses from the beginning of a new business until it is expected to become profitable
Capital budget
A financial plan for replacing fixed assets or acquiring new ones
Cash flow statement
A financial report primarily used for internal cash control
Sales budget
A forecast of the sales revenue a company expects to receive in a month, a quarter, or a year
Financial dashboard
A graphic designed to provide a quick view of financial performance indicators
Record keeping system
A manual or Automated process for collecting,organizing, and maintaining the financial information of a business
Certified public accountant (CPA)
A person who has met the state's education,experience,and examination requirements in accounting
Accounts payable record
A record showing purchases of a business,money owed and payments made by the business
Accounts receivable record
A record showing what each customer purchases,owes and pays
Budget
A written financial plan for business operations developed for a specific period of time
Small business administration (SBA)
An agency of the federal government that provides information,advice, and assistance in obtaining credit and other financial support for small businesses
Cash budget
An estimate of the flow of cash in and out of the business over a specified time period
Audit
An examination of a company's financial records by an expert to verify their accuracy
Asset
Anything of value owned,such as cash and buildings
Accounting equation
Assets=liabilities+capital
Cash dibursements
Cash payments made by a business
Liabilities
Claims against assets or things owed the debts of a business
Fixed assets
Expensive assets of a business that are expected to last and be used for a long time
Depreciation
Gradual loss of an asset's value due to age and wear
Cash receipts
Money taken in by a business
Financial records
Organized summaries of a business's financial information and activities
Financial statements
Reports that summarize financial data over a period of time
Consultant
Someone who gives professional advice or offers professional services
Income statement
Tax in the profits of businesses and the earnings of individuals
Cost of goods sold
The amount a retailer pays a supplier for the merchandise it buys and sells or the amount a manufacturer pays for raw materials and parts to make it's products
Accounts receivable
The amount customers owe the business
Gross profit
The amount remaining after subtracting the cost of goods sold from revenue
Accounts Payable
The amount the company owes for purchases it made on credit
Working capital
The difference between currant assets and current liabilities
Accounting
The process of recording,analyzing,and interpreting financial activities of a business
Data processing
The set of activities involved in obtaining,recording, Organizing, and maintaining the financial information of an organization
Balance sheet(statement of financial position )
a financial statement that reports a business's assets,liabilities, and capital on a specific date
