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STC BusinessNow CH8
| Term | Definition |
|---|---|
| Money | Anything that people generally accept as payment for goods and services. |
| Barter | The direct trade of foods and services for other foods and services. |
| Securities | Stocks and bonds that are traded. |
| Securities market | A place where stocks and bonds are traded. |
| New York Stock Exchange (NYSE) | A securities market. |
| NASDAQ | A completely electronic securities market. |
| Initial public offering (IPO) | The first public offering of a corporation’s stock. |
| Securities and Exchange Commission (SEC) | A governmental organization that has the responsibility at the federal level tor regulating activities in the various exchanges. |
| Bond | A corporate certificate indicating that a person has lent money to a firm. |
| Maturity date | The date that a bond can be cashed in. |
| Stock | Shares of ownership in a company. |
| Par value | The dollar amount assigned to each stock certificate on the corporation’s charter. |
| Dividend | Part of the firm’s profit that may be distributed to stockholders as cash payments or additional shares of stock. |
| Common stock | The most basic form of ownership in a firm. |
| Preferred stock | Stocks that offer investors a preference (hence the term “preferred”) in the payment of dividends. |
| Accounting | Recording, classifying, summarizing, and interpreting financial events and transactions to provide management and other interested parties with the information they need to make good decisions. |
| Managerial accounting | Provides information and analysis to managers within the organization to assist them in decision making. |
| Financial accounting | Generates information for use outside the organization. |
| Annual report | Yearly statement of the financial condition, progress, and expectations of an organization. |
| Certified management accountant (CMA) | A professional accountant who has met certain educational and experience requirements, passed a qualifying exam in the field, and been Certified Management Accounting. |
| Auditing | the job of reviewing and evaluating the records used to prepare a company’s financial statement. |
| Independent audit | An evaluation and unbiased opinion about the accuracy of a company’s financial statements. |
| Governmental accounting standards board (GASB) | This group sets standards for governmental agencies’ accounting practices. |
| Public accountant | An accountant who does not work for a specific company. |
| Financial accountant standards board (FASB) | The group that oversees accounting practices. |
| Generally accepted accounting principles (GAAP) | A set of principles followed by accountants in preparing reports. |
| Trail balance | A summary of all the financial date in the account ledgers that is used to check whether the figures are correct and balanced. |
| Financial statement | A summary of all the transactions that have occurred over a particular period. |
| Balance sheet | The financial statement that reports a firm’s financial condition at a specific time. |
| Cost of goods sold (cost of goods manufactured): | measure of the cost of merchandise sold, or the cost of the raw materials and supplies used for producing items for sale. |
| Gross profit (gross margin) | How much a firm earned by buying (or making) and selling merchandise, without expenses. |
| Statement of cash flows | It reports cash receipts and disbursements related to the three major activities of a firm; operations, investments, and financing. |
| Operating expenses | The cost involved in operating a business. |
| Ratio analysis | The assessment of a firm’s financial condition and performance through calculations and interpretation of financial ratios developed from the firm’s financial statement. |
| Assets | Economic resources (things of value) owned by a firm. |
| Liquidity | How fast an asset can be converted into cash. |
| Account receivable | An amount of money owed to the firm that it expects to be paid within one year. |
| Revenue | The value of what is received form goods sold, services rendered, and other financial sources. |
| Gross sales | Total of all sales the firm completed. |
| Net sales | Gross sales minus returns, discounts, and allowances. |
| Income statement | Summarizes all the resources that have come into the firm from operating activities; money the firm used up; expenses it incurred in doing business; and resources it has left after paying all costs and expenses, including taxes. |
| Owners’ equity | The amount the business that belongs to the owners minus any liabilities owed by the business. |
| Certified public accountant (CPA) | An accountant who has passed a series of examinations established by the American Institute of Certified Public Accountants (AICPA) and does accounting work for no one particular firm. |
| Private accountant | An accountant who works for a single firm, government agency, or nonprofit organization on the payroll of the company or organization. |
| Bookkeeping | The recording of business transactions. |
| Liabilities | What a business owes to others (debts). |
Created by:
vjambriz
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