vocabulary lesson # 8
401(k) financing
- Financing in which an entrepreneur funds a business with money
from his or her own 401(k) retirement account. The 401(k) account
is typically set up with an employer and used to fund retirement
needs
annual report
- A document sent to shareholders at the end of every year. Annual
reports are required by the SEC
financial manager
- An analyst who studies financial information for a firm, ranging from
cash flow analysis to profit forecasting.
Asset
- An item of value owned by an individual or firm.
fee-for-service
(FFS)
- A health care arrangement under which a health care provider
charges, and the insurance company pays for, each service
separately
504 loan
- A long term loan from the small business Admonition.
Balance sheet
- A summary of a firm’s assets, liabilities, and owner’s equity. It can
also be called a statement of financial position
net income
- A firm’s profit or loss for a period—calculated by subtracting
expenses from revenue
business
interruption
insurance
- Insurance that pays for income lost when a business is closed
because of a covered disaster
disability insurance
Insurance that pays a monthly benefit to workers who, because of
injury or illness unrelated to work, cannot do their normal job or any
other job
angel investors
- Investors who use their own money as start-up capital for a
business, usually in exchange for a share of ownership.
cash flow statement
- A document describing a company’s sources of cash and uses of
cash
obsolescence
- The decline of a product in the market due to the introduction of
better competitor products or rapid technology developments
diversification
- Increasing market penetration by moving into new markets and
broadening the consumer base or increasing the product line to sell
a variety of products
flextime
- A work schedule that shifts working hours either earlier or later than
usual, in order to accommodate an employee’s needs outside work
(such as child care) or to avoid traveling at peak commute times
asset-based loan
- A loan secured by a company’s assets.
EBITDA
- A company’s earnings before interest, taxes, depreciation, and
amortization
product
development cycle
- The process of bringing a new product to market, including
engineering and market research
employee
confidentiality
agreement
- An agreement, signed by an employee, not to disclose sensitive
information about a business. Confidentiality agreements often
cover trade secrets and client information. They allow the firm to sue
an ex-employee in court
health insurance
- Insurance plans that include coverage for medical care, dental care,
and vision care.
bank term loan
- A loan from a bank, usually at a fixed interest rate and for a
predetermined period of time
financial analysis tools
- Methods for analyzing the financial status of a firm, including
balance sheets and cash flow statements
revenue
- Total sales from goods and services before expenses and taxes.
fidelity bond
- Insurance that pays for any dishonesty the bonded employee may commit.
holiday pay
- Pay an employee receives when absent from work during a company-sanctioned day off from work.