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# AR ADV SS UNIT 8

### Arkansas Advanced Spreadsheets Unit 8-Developing a Financial Analysis

Question | Answer |
---|---|

Amortization schedule | A file with details about each loan payment, specifying how much of the payment is devoted toward interest and how much toward repaying the principal |

Balance sheet | A file that shows what the company owns and how its assets are financed |

Cash flow | The movement of cash assets into or out of an account |

Cash inflow | Cash coming into a business from revenue |

Cash outflow | Cash paid out of a business |

Cost of goods sold | Any costs directly related to production of a tangible item |

Declining balance depreciation | Depreciation of an asset by a constant percentage each year rather than a constant amount |

Dependent cell | A cell whose value depends on the value of other cells |

Depreciation | The process of allocating the original cost of the investment over the years of use |

Discount rate | Time value of money, quoted as a percentage to indicate the value of future dollars |

Error indicator | A green triangle in the upper-left corner of a cell that contains an error or potential error |

Extrapolate | To calculate a series of values from a starting point without a defined ending point |

FV function | The financial function to calculate the future value of an investment or loan |

Gross profit | The difference between the company's sales revenue and the cost of goods sold |

Growth trend | When values change not by a constant percentage; when plotted, a growth trend appears as a curve with the greatest increases occurring near the end of the series |

Income statement | A file that shows how much money a business makes or losses over a specified period of time |

Internal rate or return (IRR) | The point at which the net present value of an investment equals zero |

Interpolate | To fill in missing values when you know the beginning and the ending values in a series and the series trend |

Linear trend | When values change by a constant amount; when plotted, a linear trend appears as a straight line |

Negative cash flow | The movement of cash assets out of an account |

Net income | Income after all expenses and taxes have been paid |

Net present value | The current value of all the cash inflows and outflows in an investment adjusted by the time value of money |

NPER function | The financial function to calculate the number of payment periods in an investment or loan |

Payback period | The length of time required for an investment to recover its initial cost |

PMT function | The financial function to calculate the amount paid into an investment or loan during each payment period |

Positive cash flow | The movement of cash assets into an account, also called cash inflow |

Precedent cell | A cell whose value is used to calculate the active cell's value |

Profit and loss statement | A file that shows how much money a business makes or losses over a specified period of time |

PV function | The financial function to calculate the present value of an investment or loan |

Tangible asset | A long lasting material asset not intended for sale, such as equipment, land, buildings and delivery trucks |

RATE function | The financial function to calculate the interest rate charged or received during each payment period |

Rate of return | The time value of money, also known as the discount rate |

Risk | The possibility that an entire transaction will fail, resulting in a loss of the initial investment |

Time value of money | The assumption that money received today is worth more than the same amount received later |

Tracer arrow | An arrow that provides visual clues to the relationship between two cells by pointing from the precedent cell to the dependent cell |

Salvage value | The value of an asset at the end of its useful life |

Straight-Line Depreciation | Depreciation of an asset by equal amounts each year of its lifetime until it reaches the salvage value |

Created by:
Jame Pearce