vocab
A document issued by a seller to a buyer outlining products, quantities and agreed-upon prices for goods or services provided.
Invoice
A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time
Balance sheet
Funds raised by a company through the sale of ownership shares rather than borrowing
equity capital
funds borrowed by a company, typically through loans or bonds, that must be repaid with interest.
debt capital
A financial report showing a company’s revenues, expenses, and profits or losses over a specific period.
Income statement
Metrics used to assess a company's financial performance, such as profitability, liquidity, and solvency
Financial ratios
A flexible loan arrangement allowing a borrower to withdraw funds up to a predetermined limit.
Line of credit
An asset pledged by a borrower to secure a loan, which can be seized if the loan is not repaid.
collateral
A financial transaction where a business sells its accounts receivable to a third party at a discount for immediate cash
factoring
A financial report tracking cash inflows and outflows over a period to assess a company’s
Cash flow analysis statement
A measure of profitability indicating how much return is gained relative to the cost of an investment.
Return on investment
A financial ratio measuring a company's profitability in relation to shareholders' equity.
Return on equity
A list of all financial accounts used by a business for accounting purposes.
Chart of accounts
Money in physical or digital form that is readily available for transactions.
cash
Money owed to a company by customers for products or services provided but not yet paid for.
Accounts receivable
Long-term tangible assets, such as machinery and buildings, used in business operations.
fixed assets
Assets that can be quickly converted into cash without a significant loss in value.
liquid assets
Assets that cannot be easily converted into cash or may take time to sell.
Illiquid assets