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Financial Terms | |
Du Pont system |
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Definition of Du Pont systemDu Pont systemA breakdown of ROE and ROA into component ratios.
Related Terms:Dupont system of financial controlHighlights the fact that return on assets (ROA) can be expressed in terms Accelerated cost recovery system (ACRS)Schedule of depreciation rates allowed for tax purposes. Accounting systemA set of accounts that summarize the transactions of a business that have been recorded on source documents. actual cost systema valuation method that uses actual direct Aggregate Production FunctionAn equation determining aggregate output as a function of aggregate inputs such as labor and capital. Aging scheduleA table of accounts receivable broken down into age categories (such as 0-30 days, 30-60 aging scheduleClassification of accounts receivable by time outstanding. ![]() Amortization ScheduleA schedule that shows precisely how a loan will be repaid. The schedule gives the required payment on each specific date and shows how much of it constitutes interest and how much constitutes repayments of principal. Annuity dueAn annuity with n payments, wherein the first payment is made at time t = 0 and the last Annuity DueAnnuity where the payments are to be made at the beginning of annuity duea series of equal cash flows being received or paid at the beginning of a period annuity dueLevel stream of cash flows starting immediately. Automated storage/retrieval systemA racking system using automated systems business intelligence (BI) systema formal process for gathering and analyzing information and producing intelligence to meet decision making needs; requires information about by-productan incidental output of a joint process; it is salable, By-productA product that is an ancillary part of the primary production process, having ![]() By-productA material created incidental to a production process, which can be charge-back systema system using transfer prices; see transfer Clearing House Automated Payments System (CHAPS)A computerized clearing system for sterling funds Clearing House Interbank Payments System (CHIPS)An international wire transfer system for high-value Comprehensive due diligence investigationThe investigation of a firm's business in conjunction with a cost control systema logical structure of formal and/or informal cost management system (CMS)a set of formal methods cost of production reporta process costing document that cost reductionthe practice of lowering current costs, especially Coverdell Education IRAA form of individual retirement account whose earnings DeductibleA flat amount that an insured must pay before the insurance company makes any benefit payments under a health insurance policy. Deductive reasoningThe use of general fact to provide accurate information about a specific situation. Dollar durationThe product of modified duration and the initial price. Dow Jones industrial averageThis is the best known U.S.index of stocks. It contains 30 stocks that trade on Dow Jones Industrial AverageIndex of the investment performance of a portfolio of 30 “blue-chip” stocks. Du Pontmodel a model that indicates the return on investment Dual-currency issuesEurobonds that pay coupon interest in one currency but pay the principal in a different dual pricing arrangementa transfer pricing system that allows Dual syndicate equity offeringAn international equity placement where the offering is split into two Due billAn instrument evidencing the obligation of a seller to deliver securities sold to the buyer. Due DiligenceThe process of systematically evaluating information, to identify risks and issues relating to a proposed transaction.(i.e. verify that information is what it is proposed to be). dumpingselling products abroad at lower prices than those DurationA common gauge of the price sensitivity of an asset or portfolio to a change in interest rates. DurationThe weighted average of the time until maturity of each of the DurationThe expected life of a fixed-income security considering its coupon DurationThe time it takes for a policy or annuity to reach maturity. Dutch auctionAuction in which the lowest price necessary to sell the entire offering becomes the price at economic production run (EPR)an estimate of the number Educational Assistance PlanA plan that an employer creates on behalf of its Effective durationThe duration calculated using the approximate duration formula for a bond with an Electronic Federal Tax Payment Systems (EFTPS)An electronic funds transfer system used by businesses to remit taxes to the government. enterprise resource planning (ERP) systema packaged software program that allows a company to Enterprise resource planning systemA computer system used to manage all company equivalent units of production (EUP)an approximation of the number of whole units of output that could have been European Monetary System (EMS)An exchange arrangement formed in 1979 that involves the currencies Factor of ProductionA resource used to produce a good or service. The main macroeconomic factors of production are capital and labor. Federal Reserve SystemThe central bank of the U.S., established in 1913, and governed by the Federal Federal Reserve SystemThe central banking authority responsible for monetary policy in the United States. flexible manufacturing system (FMS)a production system in which a single factory manufactures numerous variations Fraudulent Financial ReportingIntentional misstatements or omissions of amounts or disclosures Good delivery and settlement proceduresRefers to PSA Uniform Practices such as cutoff times on delivery grade (of product or service)the addition or removal of product GradualismA policy of decreasing the rate of growth of the money supply gradually over an extended period of time, so that inflation can adjust with smaller unemployment cost. Contrast with cold-turkey policy. Graduated-payment mortgages (GPMs)A type of stepped-payment loan in which the borrower's payments Gross Domestic ProductTotal output of final goods and services produced within a country during a year. Gross domestic product (GDP)The market value of goods and services produced over time including the Gross National ProductTotal output of final goods and services produced by a country's citizens during a year. Gross national product (GNP)Measures and economy's total income. It is equal to GDP plus the income hybrid costing systema costing system combining characteristics Imputation tax systemArrangement by which investors who receive a dividend also receive a tax credit for Individual InsuranceInsurance that is offered to individuals rather than groups. Individual Retirement AccountA personal savings account into which a defined Individual Retirement AnnuityAn IRA comprised of an annuity that is managed Inductive reasoningThe attempt to use information about a specific situation to draw a conclusion. Industrial revenue bond (IRB)Bond issued by local government agencies on behalf of corporations. IndustryThe category describing a company's primary business activity. This category is usually determined Institutionally Induced UnemploymentUnemployment due to institutional phenomena such as the degree of labor force unionization, the level of discrimination, and government policies such as unemployment insurance programs, minimum wages, or regulations on business. Interac systemCanada's bank machine and electronic debit system. If you use your bank card at a bank machine which displays the Interac symbol (and that bank machine is not your bank's machine), you will be charged a fee. Investment product line (IPML)The line of required returns for investment projects as a function of beta job order costing systema system of product costing used Joint productA product that has the highest sales value from among a group of products Just-in-time inventory systemssystems that schedule materials/inventory to arrive exactly as they are just-in-time manufacturing systema production system that attempts to acquire components and produce inventory only as needed, to minimize product defects, and to Lean productionThe technique of stripping all non-value-added activities from Loan amortization scheduleThe schedule for repaying the interest and principal on a loan. lock-box systemsystem whereby customers send payments to a post office box and a local bank collects and processes checks. Macaulay durationThe weighted-average term to maturity of the cash flows from the bond, where the Macaulay durationA widely used measure of price sensitivity to yield 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). management control system (MCS)an information system that helps managers gather information about actual organizational occurrences, make comparisons against plans, management information system (MIS)a structure of interrelated elements that collects, organizes, and communicates Mandatory redemption scheduleSchedule according to which sinking fund payments must be made. Modified Accelerated Cost Recovery System (MACRS)Depreciation method that allows higher tax deductions in early years and lower deductions later. Modified durationThe ratio of Macaulay duration to (1 + y), where y = the bond yield. Modified duration is Modified durationThe Macaulay duration discounted by the per-period Modular bill of materialA bill of material format in which components and subassemblies Mortgage durationA modification of standard duration to account for the impact on duration of MBSs of Multirule systemA technical trading strategy that combines mechanical rules, such as the CRISMA National Income and Product AccountsThe national accounting system that records economic activity such as GDP and related measures. Negative durationA situation in which the price of the MBS moves in the same direction as interest rates. Net Domestic ProductGDP minus depreciation. Net National ProductGNP minus depreciation. Non-production overheadA general term referring to period costs, such as selling, administration and financial expenses. 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