Accounting & Finance
What is an asset?
Resources a business owns, such as cash, equipment, and inventory.
What is a budget?
A plan for expected income and spending.
What is a companies principal amount?
The original amount borrowed or invested.
What is Stock?
An ownership share in a company.
What is a Cash Flow Statement?
A report showing cash entering and leaving a business over a period.
What is a liability?
Debts and other financial obligations a business owes.
What is capital?
Money or other resources used to start and operate a business.
Simple Interest
Interest calculated only on the principal.
What is Capitol Gain?
Profit from selling an investment for more than its purchase cost.
What is a company's Net Profit Margin?
The percent of revenue remaining after all expenses are paid
(Net income/revenue X 100)
What is revenue?
Money earned from selling goods or services before subtracting expenses.
What are fixed costs?
Costs that remain stable as production changes within a normal operating range.
Compound Interest
Interest calculated on principal and accumulated interest.
What is Diversification?
Spreading investments across different holdings to reduce concentration risk.
Annual Percentage Yield (APY)
The annual return on a deposit, including compounding.
What are expenses?
Costs incurred to operate a business.
What are Cost of Goods Sold (COGS)?
The direct cost of products a business sells.
What is Annual Percentage Rate (APR)?
The annualized cost of borrowing, including certain fees.
What is Return on Investment (ROI)?
Net gain from an investment divided by its cost, expressed as a percentage.
What are Mutual Funds?
A fund that pools investors’ money to buy a collection of investments.
What is an income statement?
A report showing revenue, expenses, and profit or loss over a period.
What is liquidity?
The ability to meet short-term obligations using cash or assets easily converted to cash.
What is Creditworthiness?
An assessment of a borrower’s ability and likelihood to repay debt.
What is Inflation?
A general rise in prices that reduces money’s purchasing power.
What is Risk Tolerance?
How much investment uncertainty or loss someone is willing and able to accept.