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50 Cards in this Set

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Balance Sheet?
A key financial statement that is a "snapshot" at a given point in time of a company's assets, liabilities, and equity.
Amortization?
The declining value of a company's intangible assets during the time span covered by the statement.
Assets?
Assets are items of future value, tangible and intangible, used by a business. Assets are generally valued at the amount of money a company has spent in acquiring the asset
Cash Equivalents?
Line item on a balance sheet representing amounts held in short-term certificates of deposit or other instruments that are readily convertible into cash.
Accounts Payable?
Line item on a balance sheet. Amount a company owes to vendors and suppliers
Accounts Receivable?
Line item on a balance sheet. Amount a company is owed by customers.
Cash?
Line item on a balance sheet representing amounts held in currency or readily available bank deposits.
Cash-Flow Statement?
Cash-flow statement summarizes and categorizes all transactions according to their cash impact during a given time period.
Accrual?
Under the principle of accrual, sales are recorded when they are earned, that is when goods or services are provided, rather than when the cash for the sales actually changes hands. Similarly, expenses are recorded when they are incurred, rather than when they are settled.
Cash Flow?
All additions to, and subtractions from, a company's holdings of cash during a given time period.
Common Stock?
Line item on a Balance Sheet indicating amount invested by a company's shareholders to buy common stock from the company.
Cost of Goods Sold (COGS)?
Line item on an income statement reporting the cost of materials, direct labor, and overhead costs associated with providing all goods sold during a given time period.
Current Assets?
Line item on a balance sheet indicating assets that are expected to be converted into cash in 365 days or less.
Current Liabilities?
Line item on a balance sheet indicating liabilities that are expected to reduce cash within 365 days.
Current Ratio?
Current assets divided by current liabilities. A common measure of a company's liquidity, especially important to creditors. A ratio of 2 or higher is best.
Debt?
Line item on a balance sheet indicating outstanding principal owed on a company's interest-bearing loans.
Accumulated Depreciation?
Line item on a balance sheet reflecting the total depreciation expensed between the date a fixed asset was purchased and the date of the balance sheet, for all fixed assets a company still possesses.
Depreciation?
Line item on an income statement. An expense reducing earnings, theoretically reflecting the declining value of a company's fixed assets during the time period covered by the statement.
Dividends?
Earnings distributed to a company's shareholders by virtue of their share ownership. Can also be called a cash distribution.
EBITDA?
Acronym for Earnings before interest, taxes, depreciation, and amortization. A profit subtotal that can be derived from the income statement, tracked by certain industries.
Also known as Net Operating Income.
Equity?
Line item on a Balance Sheet indicating claims on a company's assets held by the company's shareholders.
Operating Expenses?
A category on an income statement, including marketing, selling, general, and administrative expenses incurred during the time period covered. Expenses do not include costs specifically related to providing products or services (COGS).
Basic Accounting Equation?
Assets = Liabilities + Equity
Financing Cash Flow(FCF)?
Grouping of line items on a cash flow statement reflecting inflows and outflows of cash related to borrowing and payback of loans (principal only), purchase or sale of stock, and dividends.
General and Administrative (G&A)?
Grouping of line items on an income statement reflecting expenses (such as computer networking, postage, and telephone bills) not directly related to the provision of goods and services.
Gross Fixed Assets?
Line item on a Balance Sheet reflecting the historical cost of fixed assets still owned by a company.
Cash Flow Projection?
A report that predicts the cash flow related to the future operations of a company for a given period of time.
Gross Profit?
Line item on an income statement. Gross Profit = Sales - Cost of goods sold.
Capital Expenditure Budget?
A report that shows the future purchases of fixed assets that are needed in order to operate the company. Also known as Cap Ex Budget or Capital Budget.
Income Statement?
A key financial statement that reports a company's sales and expenses (including cost of goods sold) and shows whether the company made a net profit on sales for the period in question. Also known as P&L, profit and loss statement, and statement of earnings.
Receivable Days?
Measure of average time a company requires to collect accounts receivable during a given time span. Receivable Days is calculated by dividing the number of days in the time span by Receivable Turnover.
Inventory?
Line item on a balance sheet indicating the cost value of raw materials, work in process, and finished goods available for sale
Investing Cash Flow (ICF)?
Also known as cash flow from investing activities. Grouping of line items on a cash-flow statement reflecting inflows and outflows of cash related to purchase or sale of fixed assets and other investments.
Liabilities?
Reported on the Balance Sheet, liabilities are claims on a company's assets held by creditors.
Receivable Turnover?
Measure of how quickly a company "turns over" its accounts receivable. Receivable turnover for a given time span is calculated by taking sales for that time span and dividing by average receivables.
Liquidity?
A company's ability to settle its current liabilities with current assets.
Retained Earnings?
Line item on a balance sheet indicating accumulated net profit earned by a company not yet paid out in dividends since the beginning of a company's life.
Matching Principle?
The accounting principle of accrual stating that costs and expenses recorded on an income statement shall be linked, or matched, to sales recorded during the time span covered by the statement.
Net Fixed Assets?
Line item on a balance sheet indicating gross fixed assets minus accumulated depreciation. Also known as net book value.
Return on Assets (ROA)?
Net profit divided by average assets. One of the three key measures of a company's performance, return on assets measures a company's effectiveness in generating profit from a given level of assets.
Net Profit?
Line item on an income statement indicating the difference between sales and all costs and expenses, including non-cash charges such as depreciation. One of the three key measures of a company's performance.
Financial Projection?
A report that uses both budget and actual figures, as well as key assumptions, to predict the future net profit of a company.
Sales?
First line item on an income statement. Indicates the total sales value of goods and services provided to customers during a given time span. Also known as revenue.
Operating Cash Flow (OCF)?
Grouping of line items on a cash-flow statement reflecting inflows and outflows of cash related to the ongoing operations of a company. One of the three key measures of a company's performance.
Net Operating Income?
Line item on many companies' income statements. Also known as EBITDA.
Net Operating income =
Sales - Cost of goods sold - Operating expenses.
Solvency?
Measure of a company's ability to function as an ongoing business. One measure of solvency is whether assets exceed liabilities.
Three key measures of a company's performance?
Net Profit
Operating Cash Flow (OCF)
Return on Assets (ROA)
Operating Budget?
A report that shows the financial goals of a company for a given period of time.
Three basic financial statements?
Balance Sheet
Income Statement
Cash Flow Statement
Prepaid Expenses?
Expenses paid that relate to more than one month that appear on the Balance Sheet and are waiting to be expensed in the future