The function in a business that acquires funds for the firm and managers those funds within the firm.
The process of selling acounts receivable for cash.
A financial plan that sets forth management's expectations, and on the basis of those expectations allocates the use of specific resources throughout the firm.
Raising needed funds through borrowing to increase a firm's rate of return.
Line of credit (498)
A given amount of unsecured short-term funds a bank will lend to a business, provided the funs are readily available
Risk/return trade-off (502)
The principle that the greater the risk a lender takes in making a loan, the higher the intrest rate required.
Secured loan (498)
A loan backed by collateral, something valuable such as property
Trade credit (496)
The practice of buying goods and services now and paying for them later
Mutual fund (530)
An organization that buys stocks and bonds and then sells shares in those securities to the public.
Common stock (520)
The most basic form of ownership in a firm; it confers voting rights and the right to share in the firm's profits through dividens, if approved by the firm's board of directors.
Capital gains (527)
The positive difference between the purchase price of a stock and its sale price
Part of a firm's profits that the firm may distribut to stockholders as either cash payments or additional shares of stock.
Dow Jones (534)
The average cost of 30 selected industrial stocks, used to give an indication of the direction (up or down) of the stock market over time.
Initial public offering IPO (514)
The first public offering of a corporation's stock
Institutional investors (515)
Large organizations such as pension funds, mutual funds and insurance companies - that invest their own funds or the funds of others.
investment bankers (515)
Secialists who assist in the issue and sale of new securities.
The payment the issuer of the bond makes to the bondholders for use of the borrowed money.
Mutual fund (530)
An orgnaization that buys stocks and bonds and then sells shares in those securiities to the public.
A registered representative who works as a market intermediary to buy and sell securities for clients.
stock exchange (515)
An organization whose members can buy and sell (exchange) securiites for companies and individual investors.
The direct trading of goods or services for other goods or serivces.
Commerical bank (554)
A profit-seeking orgnization that recieves deposits from individuals and corporations in the form of checking and savings accounts and then uses some of these funds to make loans
Certificate of deposit (555)
A time-deposit (savings) account that earns interest to be delivered at the end of the certicicate's maturity date.
Demand Deposit (555)
The technical name for a checking account; the money in a demand deposit can be withdrawn anytime on demand from the depositor
Discount Rate (551)
The interest rate that the Fed charges for loans to member banks.
Federal Deposit Insurance Corporation FDIC (559)
An indpependent agency of the U.S. government that insures bank deposits.
Anything that people generally accept as payment for goods and services
Reserve requirment (550)
A percentage of commerical banks' checking and savings accounts that must be physically kept in the bank.
Insurable risk C-5
A risk tat the typeical insurance company will cover.
Mutual insurance company C-7
A type of insurance company owned by its policyholders.
Rule of idemnity C-6
Rule sying that an isured person or organization cannot collect more than the actual loss from an insurable risk.
The practice of setting aside money to cover routine cliams and bying only "catastrophe" policies to cover big lossses.
A contract to make regular payments to a person for life or for a fixed period.
Social Security D-12
The term used to describe the Old-Age, Survivors and Disability Insurance Program established by the Social Security Act of 1935
Tax-deferred contributions D-12
Retirment account deposits for which you pay no current taxes, but the earnings gained are taxed as regular income when they are withdrawn at retirment.
A doucment that names, the guardian for your children, stqtes how you want your assets distributed, and names the executor for your estate
The recording, classifying, summarizing and interpreting of financial events and transactions to provide management and other interested parties the information they need to make good decisions.
Econcomic resources (things of value) owned by a firm.
The job of reviewing and evaluating the information use to prepare a company's financial statments.
Balance sheet (465)
Financial statment that reports a firm's financial condition at a specific time and is composed of three major accounts: assets, liabilities, and owners' equity.
Cerified public accountant CPA (459)
An accountant who passes a series of examinations establihed by the Americl Institute of Certified Public Accountants.
The systematic write-off of the cost of a tangible asset over its estimated useful life.
income statment (468)
The financial statment that shows a firm's profit after costs, expenses and taxes; it summarizes all of the resources that have come into the firm (revenue), all the resources that have left the firm and the resulting net income.
What the business owes to others (debts).
The ease with which an asset can be converted into cash.
Chairman of the federal reserve
Ben S. Bernanke
is an approach to planning and decision-making which reverses the working process of traditional budgeting.