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Debt obtained from a number of online companies. Borrowers need to disclose much less information about themselves to obtain online credit, and online credit companies make credit decisions much more quickly than banks. For these reasons, online credit is much more expensive for borrowers than bank loans.
What is Online Credit
Costs that a business incurs that are not part of producing the goods or services its sells, but which are required to operate legally and efficiently. Example: "The salary I pay my accountant is overhead - these funds don't help us sell more product, but I need my accountant to keep our financial records and submit all required filings."
What is Overhead
The amount of money borrowed.
What is Principal
Revenues minus costs.
What is Profit
Repaying the loan
What is Satisfy a Loan
The percentage of a loan a bank or online credit company charges when a small business receives a loan. Original fees add to the cost of the loan.
What is Origination Fee
Owning an asset without any associated debt. Example: "I paid off my car loan last month, so now I own my car 'free and clear.'"
What is Own "Free and Clear"
Unit price minus cost of goods sold
What is Profit per Unit
Most projections are for a year (or “annual” projections). A “quarter” means three months. New and seasonable businesses are most likely to make quarterly projections to make sure they’re on track for success.
What is Quarter
Debt that includes a legal obligation by the borrower to repay the debt personally if the business is unable to make its scheduled debt payment. A secured debt can be guaranteed by the entrepreneur or by any credit-worthy guarantor.
What is Secured Dept
When a company issues a check or makes a financial commitment for an amount greater than the amount the company has deposited in the bank. Also called "a bounced check."
What is Overdraft
A legal agreement that an assets is part of a guarantee to a lender, when the lender can take possession of the assets and sell it to recover the funds owed by a borrower in the event the borrower is unable to make a required debt payment
What is Pledged
A Latin phrase (“for the sake of form”) that in business means a projection of future financial performance. A pro forma usually takes the form of a projection of future revenues and costs.
What is Pro Forma
Real estate is property and the building(s) on it. Real estate can be a piece of land, or it can be a home on that piece of land, or it can be a building. Real estate is typically purchased using a mortgage. The down payment the buyer makes is called the buyer’s “equity.”
What is Real Estate
An investment vehicle. Different types of securities include stocks, bonds and mutual funds
What is Security
How a business moves a specific customer to buy their service or offering. Example: a special event in a store's parking lot featuring discount prices is selling.
What is Selling
All people or companies associated with an enterprise. Stakeholders include internal stakeholders (employees and shareholders / owners) as well as external stakeholders (customers, suppliers, community members)
What is Stakeholders
A company that provides a good or service to another company. Example: "The beauty products distributor is my supplier - I buy the hair care products I sell to my customers from my distributor."
What is Supplier
The exact customers and market sector the business intends to serve
What is Target market
Units times price. If the enterprise sells more than one type of unit, then Total Revenue equals the sum of revenues created by selling each type of unit.
What is Total Revenue
Costs that vary somewhat based on the number of units you sell. Example: if your enterprise buys an iPhone you won’t have to pay again for apps you already own.
What is Semi-Variable Costs
Shares of ownership in a company. Stock is a general term of ownership in any company. Example: if investors say they own stocks, they are generally referring to their overall ownership in one or more companies.
What is Stocks
The hard work a small business owner puts into forming, founding and operating his/her business – small business owners typically work very long hours. Sweat equity is as important as any capital but it’s not a cash investment.
What is Sweat Equity
Fixed costs plus variable costs. If the enterprise sells more than one type of unit, Total Costs equal the sum of fixed costs and the sum of variable costs (or cost of goods sold) for each type of unit
What is Total Costs
Companies that conduct business with a company, and that can document how well a company pays its bills to its suppliers.
What is Trade References