Chapter 12: Financial management

All income that a business receives over a period of time.

The cost of operating a business.

It plans income and expenses from the beginning of a new business or a major business expansion until it becomes profitable.

Operating budget describes the financial plan for ongoing operations of the business for a specific period.

An estimate of the actual money received and paid out for a specific period.

are used to record and analyze the financial performance of a business.

The assets, liabilities, and owner's equity for a specific date are listed.

are what the company owns.

are what the company owes

is the value of the owner's investment in the business

To report the revenue, expenses, and net income or loss from operations for a specific period.

is the financial record of employee compensation, deductions, and net pay.

are the documentation used to process earnings payments and record each employee's pay history.

the employer transfers net pay electronically into the employee's bank account.

are comparisons of a company's financial elements that indicate how well the business is performing.

are the differences between actual and budgeted performance.

identify the buildings and equipment owned by the business, their original and current value, and the amt. owed if money was borrowed to purchase the assets.

identify the amt. assets have decreased in value due to their age and use.

identify the type and quantity of resources and products on hand along with the current value of each.

list all the cash received and spent by the business.

Reports that sums up the financial performance of a business

is the value of the business after liabilities are subtracted from assets.

loss occurs when expenses are greater than income

maintains information on each employee to be able to calculate company's payroll

is included with the employee's paycheck