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Definition of Debtors
Sales to customers who have bought goods or services on credit but who have not yet paid their debt.
Notes receivable are promissory notes that the company has accepted from its debtors. Most promissory notes pay interest. Those that are due within a year are shown under “Current Assets.” Those that mature in more than a year would be listed under “Long-term Assets.” If a note is being
Amounts receivable by the business within a period of 12 months, including bank, debtors, inventory and prepayments.
Current assets less current liabilities. Money that revolves in the business as part of the process of buying, making and selling goods and services, particularly in relation to debtors, creditors, inventory and bank.
Money owed by customers.
The ratio of net credit sales to average accounts receivable, a measure of how
A merger or consolidation in which an acquirer purchases the selling firm's assets.
A firm's productive resources.
A common element of a financial plan that describes projected capital spending and the
The weighted-average age of all of the firm's outstanding invoices.
The ratio of accounts receivables to sales, or the total
notes issued by states and municipalities to obtain interim financing for
Net flow of goods, services, and unilateral transactions (gifts) between countries.
A bond selling at or close to par, that is, a bond with a coupon close to the yields currently
Amount owed for salaries, interest, accounts payable and other debts due within 1 year.
In Treasury securities, the most recently auctioned issue. Trading is more active in current
current time to maturity on an outstanding debt instrument.
Current rate method
Under this currency translation method, all foreign currency balance-sheet and income
Indicator of short-term debt paying ability. Determined by dividing current assets by current
For bonds or notes, the coupon rate divided by the market price of the bond.
Related: Benchmark issues
Days in receivables
Average collection period.
Demand master notes
Short-term securities that are repayable immediately upon the holder's demand.
Documented discount notes
Commercial paper backed by normal bank lines plus a letter of credit from a
Exchange of assets
Acquisition of another company by purchase of its assets in exchange for cash or stock.
Note the maturity of which can be extended by mutual agreement of the issuer and
Claims on real assets.
Value of property, equipment and other capital assets minus the depreciation. This is an
Money market notes
Publicly traded issues that may be collateralized by mortgages and MBSs.
Short-term notes issued by municipalities in anticipation of tax receipts, proceeds from a
The difference between total assets on the one hand and current liabilities and noncapitalized longterm
A tangible asset with unique physical properties, like a parcel of land, a mine, or a
Notes to the financial statements
A detailed set of notes immediately following the financial statements in
Other current assets
Value of non-cash assets, including prepaid expenses and accounts receivable, due
Project notes (PNs)
Project notes are issued by municipalities to finance federally sponsored programs in
Publicly traded assets
assets that can be traded in a public market, such as the stock market.
current assets minus inventories.
Identifiable assets, such as buildings, equipment, patents, and trademarks, as distinguished from a
Receivables balance fractions
The percentage of a month's sales that remain uncollected (and part of
Receivables turnover ratio
Total operating revenues divided by average receivables. Used to measure how
A tangible asset with physical properties that can be reproduced, such as a building or
assets that remain after sufficient assets are dedicated to meet all senior debtholder's claims in full.
Return on assets (ROA)
Indicator of profitability. Determined by dividing net income for the past 12 months
Return on total assets
The ratio of earnings available to common stockholders to total assets.
TANs (tax anticipation notes)
Tax anticipation notes issued by states or municipalities to finance current
Debt obligations of the U.S. Treasury that have maturities of more than 2 years but less than 10 years.
Amounts owed to a company by customers that it sold to on credit. Total accounts receivable are usually reduced by an allowance for doubtful accounts.
Anything of value that a company owns.
Bills a company must pay within the next twelve months.
A ratio that shows how many times a company could pay its current debts if it used its current assets to pay them. The formula:
NUMBER OF DAYS SALES IN RECEIVABLES
(also called average collection period). The number of days of net sales that are tied up in credit sales (accounts receivable) that haven’t been collected yet.
RATE OF RETURN ON TOTAL ASSETS
The percentage return or profit that management made on each dollar of assets. The formula is:
Things that the business owns.
Amounts due and payable by the business within a period of 12 months, e.g. bank overdraft, creditors and accruals.
Things that the business owns and are part of the business infrastructure – fixed assets may be
Intangible fixed assets
Non-physical assets, e.g. customer goodwill or intellectual property (patents and trademarks).
Tangible fixed assets
Physical assets that can be seen and touched, e.g. buildings, machinery, vehicles, computers etc.
Amounts owed to the company, generally for sales that it has made.
Items owned by the company or expenses that have been paid for but have not been used up.
assets owned by the company that do not possess physical substance; they usually take the form of rights and privileges such as patents, copyrights, and franchises.
Amounts owed by the company that have been formalized by a legal document called a note.
Short-term, non-interest-bearing debts owed to a
accounts receivable turnover ratio
A ratio computed by dividing annual
current means that these liabilities require payment in
Calculated to assess the short-term solvency, or debt-paying
An informal term that refers to the variety of long-term operating
return on assets (ROA)
Although there is no single uniform practice for
A measure of the ability of a company to use its current assets to
Fixed Assets Turnover Ratio
A measure of the utilization of a company's fixed assets to
Return on Total Assets Ratio
A measure of the percentage return earned on the value of the
Total Debt to Total Assets Ratio
See debt ratio
see simultaneous engineering
A current asset on the balance sheet, representing short-term
Typically the cash, accounts receivable, and inventory accounts on the
Under target costing concepts, this is the cost that would be applied to a
This is typically the accounts payable, short-term notes payable, and
A cluster of accounts that are listed after fixed assets on the balance sheet,
Annual coupon payments divided by bond price.
Claims to the income generated by real assets. Also called securities.
assets used to produce goods and services.
That part of the balance of payments accounts that records demands for and supplies of a currency arising from activities that affect current income, namely imports, exports, investment income payments such as interest and dividends, and transfers such as gifts, pensions, and foreign aid.
A variable like GDP is measured in current dollars if each year's value is measured in prices prevailing during that year. In contrast, when measured in real or constant dollars, each year's value is measured in a base year's prices.
The percentage return on a financial asset based on the current price of the asset, without reference to any expected change in the price of the asset. This contrasts with yield-to-maturity, for which the calculation includes expected price changes. See also yield.
Current Tax Payment Act of 1943
A federal Act requiring employers to withhold income taxes from employee pay.
Amounts due from customers for sales on open account, not evidenced
Accounts Receivable Days (A/R Days)
The number of days it would take to collect the ending
Current Income Tax Expense
That portion of the total income tax provision that is based on
Preferred Stock Stock that has a claim on assets and dividends of a corporation that are prior
to that of common stock. Preferred stock typically does not carry the right to vote.
Realizable Revenue A revenue transaction where assets received in exchange for goods and
services are readily convertible into known amounts of cash or claims to cash.
Unbilled Accounts Receivable
Revenue recognized under the percentage-of-completion
Money owed to a business for merchandise or services sold on open account.
Debts or other obligations coming due within a year.
current assets divided by current liabilities. This ratio indicates the extent to which the claims of short-term creditors are covered by assets expected to be converted to cash in the near future.
Discounting of Accounts Receivable
Short-term financing in which accounts receivable are used as collateral to secure a loan. The lender does not buy the accounts receivable but simply uses them as collateral for the loan. Also called pledging of accounts receivable.
Land, buildings, plant, equipment, and other assets acquired for carrying on the business of a company with a life exceeding one year. Normally expressed in financial accounts at cost, less accumulated depreciation.
Longer-Term Fixed Assets
assets having a useful life greater than one year but the duration of the 'long term' will vary with the context in which the term is applied.
assets, the title of which are held personally rather than in the name of some other legal entity.
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