Term
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Definition
AKA Statement of Fianancial Position
- assets
- liabilities
- stockholder's equity
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Term
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Definition
Current & Fixed
Current - can be converted to chash or its equivalent in less than one year
Fixed - relatively permanent and take time to convert to cash |
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| Cash, Accounts receivable, Inventories |
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Definition
| Money paid towards plant, land, factory machinary, office equipment, and autos. |
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Definition
| Investments made to other companies and intangibles - goodwill, copyrights, franchise etc. (Goodwill only when an operating business is purchased in entirity with fair market price (the price buyer is willing to pay)). |
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Definition
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| debts which must be paid in the near future (normally within one year), include accounts and notes payable and any accrued expenses |
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Definition
| Long ter liabilities, such as bonds, mortgages and long term notes (longer than a year). |
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Definition
| amount available to the owners after all other debts have been paid. Consists of preffered, common, treasury stock, capital surplus, and retained earnings. |
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| Hybrid between debt and common stock. Do not earn if company grows. Not common |
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| aggregate par value of the company's stock issued. |
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Definition
| the amount of money received from the sale of stock that is over and above the par value of the stock. |
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Definition
| the cumulative net income of the firm since its inception, less the total divdends that have been paid to stock holders. Profits thrown back into fiance things in the business. Retained Earnings belong to stockholders. |
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Definition
| indication of whether the company is making or losing money during a stated period (usually year but sometimes monthly or quarterly). AKA ACCOUNTING PERIOD |
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Definition
| represents gross sales, less any sales return and allowances. |
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Definition
| largest expense for manufacturing, in making a product this is knowns as cost of revenue. |
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Definition
| Net Revenue - cost of revenue |
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Term
| Operating Income (Margin) |
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Definition
| Operating Income - Operating Expenses (interest, machine, administration, sales, etc. is under expenses) |
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Term
| Net Income, Net Margin, Accounting Income |
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Definition
| Taxable Income - Income Taxes |
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Term
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Definition
| Available Earnings to stockholders/Common stock outstanding |
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| Retained Earnings (profits) |
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Definition
| Net Income - Preferred and Common Stock Dividends |
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Term
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Definition
Operation Activities
Investing Activities
Fianancing Activities |
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Term
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Definition
| cash flows related to production and sales of goods or services. Depreciation is an expense but NOT considered in operating activities under the cash flow statement. |
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Definition
| purchasing new fixed assets, reselling old equipment, and buying and selling financial assets |
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Definition
| Borrow or sell more stock (inflow), paying debt (outflow) |
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| 3 categories of manufacturing costs |
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Definition
| direct raw material, direct labor, and manufacturing overhead |
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| Any materials used in the final product that can be easily traced to. Examples, wood in furniture, steel in a bridge, fabric in clothing. |
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Definition
| Costs incured in production. Cost of assembly line workers, labor costs of welders, carpenters or brick layers in home building, machine operators. |
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Definition
| Costs of indirect materials; indirect labor (security guard, janitor, supervisor, etc.); maintenance and reapirs on production equipment; heat and light, property taxes, depreciation and insurance on manufacturing facilities. Not easily traceable to specific units of output. Many don't change as out put changes. |
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Definition
Marketing/Selling Costs
Administrative Costs |
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Definition
| all costs to secure customer orders and get finished product or service into the hands of the customer. |
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Definition
| Executive compensation, general accouting, public relations, and secretarial support associated with general managment of an association. |
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Definition
| the costs incurred in generating a certain amount of revenue should be recognized as expenses in the same period that the revenue is recognized |
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Definition
| Costs charged to expenses in the period in which they are incurred. period costs appear on the income statement as expenses |
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Definition
| Is an ASSET until the goods are sold. When sold released from inventory as expenses and matched against sales revenue. AKA INVENTORY COSTS. Appear on financial statements when inventory is sold, not when it is made. |
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Term
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Definition
- Balance Sheet Statement as Inventory Costs
- When sold goes to Income Statement as "costs of goods sold"
- ALWAYS THE SAME NUMBER THAT GETS TRANSFERRED
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Definition
| Account in the balance sheet statement that represents the unused portion of the raw materials on hand at the end of the fiscal year. |
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| Work In Progress Inventory |
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Definition
| Balance sheet entry consists of the partially completed goods on hand in the factory at year end. Direct labor and manufacturing overhead costs are also added directly to work in process. |
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| Shows the costs of finished goods that are on hand and awaiting sale to customers at year end. |
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Term
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Definition
| based on production inputs, such as tons of coal processed, direct labor hours used or machine hours worked or it may be based on production outputs, such as the number of kwh generated. |
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Definition
| wide span of output over which costs are expected to remain constant. |
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Definition
| close relationship to the level of volume of a business. |
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Definition
| Do not fall into fixed or variable. Examples include depreciation or lighting (can depend on miles driven or age of car). AKA SEMIVARIABLE COSTS |
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Term
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Definition
| Xb = Fixed Costs/Contribution Margin |
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Term
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Definition
| Selling price - variable cost |
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Definition
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Term
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Definition
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Term
| Times Interest Earned Ratio (TIER) |
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Definition
(EBIT + Interest Expense)/Interest Expense
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Term
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Definition
| Current Assets/Current Liabilities |
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Definition
| Current Assets - Inventories/Current Liabilities |
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Term
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Definition
| Sales/Average Inventory Balance |
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Term
| DSO (Day's Sales Outstanding) |
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Definition
| Receivables/Average Sales per day |
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| Total Assets Turnover Ratio |
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Definition
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Definition
| Net Income Available to Stockholders/Sales |
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Definition
| Net Income + InterestExpense*(1-tax rate)/Average total assets |
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Definition
| Net Income Available To CS/Average Common Equity |
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| ROE (return on common equity) |
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Definition
| Net Income/Stockholders Equity |
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Term
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Definition
| Price per share/Earnings Per Share |
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Term
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Definition
| Total Stockholders Equity - PS/Average Shares outstanding |
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