Financial Management

  1. revenue
    all income that a business receives over a period of time
  2. expenses
    the costs of operating a business
  3. budget
    detailed financial plan
  4. start-up budget
    plans income and expenses for a new business
  5. operating budget
    financial plan for ongoing operations of a business for a specific period
  6. cash budget
    estimate of the actual money received and paid out for a specific period
  7. financial records
    record and analyze the financial; performance of a business
  8. assets
    what a company owns
  9. liabilities
    what a company owes
  10. owner's equity
    value of the owner's investment in the business
  11. balance sheet
    assets, liabilities, and owner's equity for a specific date
  12. income statement
    revenue, expenses and net income or loss from operations for a specific period (usually 6 months or a year)
  13. payroll
    financial record of employee compensation, deduction, and net pay
  14. payroll records
    the documentation used to process earnings payments and record each employee's pay history
  15. direct deposit
    the employee transfers net pay electronically into the employee's bank account
  16. financial performance ratios
    comparisons of a company's financial elements that indicate how well the business is performing
  17. discrepensies
    differences between actual and budgeted performance
  18. business budget
    • main purposes:
    • 1. anticipate sources and amounts of income for a business
    • 2.predict types/amounts of expenses
  19. revenue
    all income received by the business
  20. payroll taxes
    social security, medicare, income tax, unemployment tax
  21. return to equity ratio
    net profit compared to owner's equity
  22. current ratio
    current assets compared to current liabilities
  23. debt to equity
    company's liabilities compared to the owner's equity
  24. net income
    when revenue is greater than exspenses
  25. net loss
    when expenses are greater than income
  26. long-term assets (fixed assets)
    assets with a life span of more than a year
  27. current assets
    cash and items that can be readily converted into cash like inventory and accounts recievable
Card Set
Financial Management