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Definition of Autocorrelation
The correlation of a variable with itself over successive time intervals.
Accelerated cost recovery system (ACRS)
Schedule of depreciation rates allowed for tax purposes.
Accounts receivable turnover
The ratio of net credit sales to average accounts receivable, a measure of how
accounts receivable turnover ratio
A ratio computed by dividing annual
the amount of overhead that has been assigned to Work in Process Inventory as a result of productive activity; credits for this amount are to an overhead account
Extent to which a company's net assets cover a particular debt obligation, class of preferred stock, or equity position.
A bond indenture restriction that permits additional borrowing on if the ratio of assets to
The ratio of net sales to total assets.
a ratio measuring asset productivity and showing the number of sales dollars generated by each dollar of assets
asset turnover ratio
A broad-gauge ratio computed by dividing annual
Money owed to the bank in a cheque account where payments exceed receipts.
Related: Premium payback period.
Refers to recouping, or regaining, invested capital over
Cash flow coverage ratio
The number of times that financial obligations (for interest, principal payments,
Cash flow time-line
Line depicting the operating activities and cash flows for a firm over a particular period.
The number of cash cycles completed in one year.
coefficient of correlation
a measure of dispersion that indicates the degree of relative association existing between two variables
Continuous random variable
A random value that can take any fractional value within specified ranges, as
See: correlation coefficient.
The simultaneous change in value of two random numeric variables.
an analytical technique that uses statistical
A standardized statistical measure of the dependence of two random variables,
A measure of the tendency of two variables to change values
A statistic in which the covariance is scaled to a
The purchase of a contract to offset a previously established short position.
Ratios used to test the adequacy of cash flows generated through earnings for purposes of
Coverdell Education IRA
A form of individual retirement account whose earnings
A short call option position in which the writer owns the number of shares of the underlying
Covered call writing strategy
A strategy that involves writing a call option on securities that the investor
Covered interest arbitrage
A portfolio manager invests dollars in an instrument denominated in a foreign
Covered or hedge option strategies
Strategies that involve a position in an option as well as a position in the
A put option position in which the option writer also is short the corresponding stock or has
The return at which two alternative projects have the same net present value.
the time between the placement of an order to
Debt-service coverage ratio
Earnings before interest and income taxes plus one-third rental charges, divided
an unknown item for which a linear programming
an unknown variable that is to be predicted
Discrete random variable
A random variable that can take only a certain specified set of discrete possible
Doctrine of sovereign immunity
Doctrine that says a nation may not be tried in the courts of another country
employee time sheet
a source document that indicates, for each employee, what jobs were worked on during the day and for what amount of time
A value determined within the context of a model.
A variable whose value is determined outside the model in which it is used. Also called
All the costs incurred during the manufacturing process, minus the
First To Die Coverage
This means that there are two or more life insured on the same policy but the death benefit is paid out on the first death only. If two or more persons at the same address are purchasing life insurance at the same time, it is wise to compare the cost of this kind of coverage with individual policies having a multiple policy discount.
Fixed asset turnover ratio
The ratio of sales to fixed assets.
Fixed Assets Turnover Ratio
A measure of the utilization of a company's fixed assets to
Fixed-charge coverage ratio
A measure of a firm's ability to meet its fixed-charge obligations: the ratio of
Fixed Charge Coverage Ratio
A measure of how well a company is able to meet its fixed
That portion of total overhead costs which remains constant in size
fixed overhead spending variance
the difference between the total actual fixed overhead and budgeted fixed overhead;
fixed overhead volume variance
see volume variance
Purchase or sale of forward foreign currency in order to offset a known future cash flow.
See: Government securities.
Government National Mortgage Association (Ginnie Mae)
A wholly owned U.S. government corporation
Negotiable U.S. Treasury securities.
Government sponsored enterprises
Privately owned, publicly chartered entities, such as the Student Loan
the amount of time spent in storing inventory or
a variable that, when changed, will
the time taken to perform quality control activities
Interest coverage ratio
The ratio of the earnings before interest and taxes to the annual interest expense. This
Interest coverage test
A debt limitation that prohibits the issuance of additional long-term debt if the issuer's
The ratio of annual sales to average inventory which measures the speed that inventory
The number of times a company sold out and replaced its average stock of goods in a year. The formula is:
The number of times per year that an entire inventory or a
Ratio of annual sales to inventory, which shows how many times the inventory of a firm is sold and replaced during an accounting period.
inventory turnover ratio
The cost-of-goods-sold expense for a given
Inventory Turnover Ratio
Provides a measure of how often a company's inventory is sold or
Just-in-time inventory systems
Systems that schedule materials/inventory to arrive exactly as they are
a philosophy about when to do something;
A cluster of manufacturing, design, and delivery practices designed to
The term for several manufacturing innovations that
just-in-time manufacturing system
a production system that attempts to acquire components and produce inventory only as needed, to minimize product defects, and to
a system that maps the skill sets employees
a critical factor that management believes will
Last To Die Coverage
This means that there are two or more life insured on the same policy but the death benefit is paid out on the last person to die. The cost of this type of coverage is much less than a first to die policy and it is generally used to protect estate value for children where there might be substantial capital gains taxes due upon the death of the last parent. This kind of policy is also valuable when one of two people covered has health problems which would prohibit obtaining individual coverage.
see cycle time
MACRS (Modified Accelerated Cost Recovery System)
A depreciation method created by the IRS under the Tax Reform Act of 1986. Companies must use it to depreciate all plant and equipment assets installed after December 31, 1986 (for tax purposes).
The theory that in certain situations, institutions wish to sell their shares but postpone the
A money manager who assumes he or she can forecast when the stock market will go up and down.
Modified Accelerated Cost Recovery System (MACRS)
Depreciation method that allows higher tax deductions in early years and lower deductions later.
A general term referring to period costs, such as selling, administration and financial expenses.
Normal random variable
A random variable that has a normal probability distribution.
Over-the-counter market (OTC)
A decentralized market (as opposed to an exchange market) where
Shares traded off an organized exchange.
a credit balance in the overhead account
An indicator that attempts to define when prices have moved too far and too
The amount by which a check or other payments exceeds the funds on deposits.
Is an agreement with the Bank or Financial Institution to cover overdrafts. This service will typically involve a fee and be limited to a pre-set maximum amount.
A short-term source of credit which allows you to overdraw on your account up to a pre-established limit. For example, overdraft protection spares customers both the cost and the personal embarrassment of NSF cheques. overdraft protection is attached to your PCF Chequing Account.
System whereby a depositor may write cheques in excess of the balance, with the bank automatically extending a loan to cover the shortage.
Overfunded pension plan
A pension plan that has a positive surplus (i.e., assets exceed liabilities).
Any cost other than a direct cost – may refer to an indirect production cost and/or to a non-production expense.
any factory or production cost that is indirect to
The process of spreading production overhead equitably over the volume of production of goods or services.
overhead application rate
see predetermined overhead rate
overhead generally refers to indirect, in contrast to direct,
overhead efficiency variance
the difference between total budgeted overhead at actual hours and total budgeted
The rate (often expressed per hour) applied to the time taken to produce a product/service, used to allocate production overheads to particular products/services based on the time taken. May be calculated on a business-wide or cost centre basis.
overhead spending variance
the difference between total actual overhead and total budgeted overhead at actual
A strategy of using futures for asset allocation by pension sponsors to avoid disrupting the
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