Financial Management

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Author:
wilkinsk0120
ID:
238135
Filename:
Financial Management
Updated:
2013-10-01 11:41:27
Tags:
Chaper 12 Finantial Management
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Description:
Definitions of key words chaper 12
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  1. Revenue
    All income that a business receives over a period of time
  2. Expenses
    The costs of operating a business
  3. Budget
    detailed plans for the financial needs of individuals, families, and businesses
  4. Start-up Budget
    plans income and expanses from the beginning of a new business or a major business
  5. Operating budget
    financial plan for ongoing operations of the business for a specific period.
  6. Cash budget
    is an estimate of the actual money received and paid out for a specific period.
  7. Financial Records
    are used to record and analyze the financial performance of a business.
  8. assets
    are what a company owns
  9. Liabilities
    are what a company owes
  10. owner's equity
    is the value of the owner's investment in the business
  11. Balance sheet
    is often prepared every 6 months has date and all assets, liabilities, and equities listed.
  12. income statement
    report the revenue, expenses and net income or loss from operations for a specific period.
  13. Payroll
    financial record of employee compensation, deductions, and net pay.
  14. Payroll records
    documentation used to process earnings payments and record each employee's pay history.
  15. direct deposit
    employer transfers net pay electronically into the employee's bank account
  16. Financial performance ratios
    are comparisons of a company's financial elements that indicate how well the business is performing.
  17. Discrepancies
    are differences between actual and budget performance.
  18. Current ratio
    current assets compared to the current liabilites.
  19. debt to equity ratio
    company's liabilities divided by the own's equity is the debt to equity ratio.
  20. Return on equity ratio
    net profit of the business compared to the amount of own's equity
  21. Net income ratio
    total sales compared to the net income for a period such as 6 months or a year.
  22. Income taxes
    federal government.most states,and some local government
  23. Social security and medicare
    payments are often referred to as Federal Insurance Contrutions Act.
  24. Unemployment taxes
    employers pay federal unemployment tax to the unemployment insurance system.
  25. 4 Financial steps
    • prepare a list for each income and expense
    • gather accurate info
    • create budget
    • explain the budgets

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