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Definition of Income statement
A financial report that summarizes a company’s revenue, cost of
An accounting statement that summarizes information about a company in the following format:
Financial statement that shows the revenues, expenses, and net income of a firm over a period of time.
Financial statement that summarizes sales revenue
One of the basic financial statements; it lists the revenue and expense accounts of the company.
income statement that presents items as a percentage of revenues.
A statement showing the revenues, expenses, and income (the
A financial statement that displays a breakdown of total sales and total expenses.
Earnings of a firm as reported on its income statement.
Yearly record of a publicly held company's financial condition. It includes a description of the
A term often used instead of the more formal and correct
Pretax income reported on the income statement.
In Finance: to find the present value of a stream of cash flows.
Interest that is not immediately expensed, but rather is considered as an asset and is then
The location of five New York futures exchanges: Commodity
The cumulative, after-tax, prior-year effect of a change in accounting
No pun intended, but these types of gains
A transaction that rarely occurs, and which is unusual, such as
Financial means having to do with
An account for the investment credit to show all income statement benefits of the credit
Free cash flows
Cash not required for operations or for reinvestment. Often defined as earnings before
gross margin, or gross profit
This first-line measure of profit
Income Tax Provision
The expense deduction from pretax book income reported on the
This is difficult to define in a few words—indeed, an
The accounting principle that requires the recognition of all costs that are associated with
The last line of the income statement; it represents the amount that the company earned during a specified period.
NET SALES (revenue)
The amount sold after customers’ returns, sales discounts, and other allowances are taken away from
A measure of results produced by the core operations of a firm. It is common
Pro forma statement
A financial statement showing the forecast or projected operating results and balance
This is a key factor in the profit model of a business. Product
The general term profit is not precisely defined; it may refer to net
profit and loss statement (P&L statement)
This is an alternative moniker
Profits a company plowed back into the business over the years. Last January’s retained earnings, plus the net income or profit that a company made this year (which is calculated on the income statement), minus dividends paid out, equals the retained earnings balance on the balance sheet date.
Operating expenses that vary in proportion to
The accounts found on the income statement and the statement of Retained Earnings; these accounts are reduced to zero at the end of every accounting period.
The process of dividing each expense item in the income statement of a given year by net
A financial analysis technique that relates key amounts on the income statement and balance sheet to a 100 percent or base figure for the present and previous year.
income that has been earned but not yet received. For instance, if you have a non-registered Guaranteed Investment Certificate (GIC), Mutual Fund or Segregated Equity Fund, growth accrues annually or semi-annually and is taxable annually even though the gain is only paid at maturity of your investment.
Accumulated Other Comprehensive Income
Cumulative gains or losses reported in shareholders'
Adjusted Income from Continuing
Operations Reported income from continuing operations
A statement that shows where a company’s cash came from and where it went for a period of time, such as a year.
Cash Flow statement
A financial report that shows the movement in cash for a business during an accounting period.
Cash Flow–to–Income Ratio (CFI)
Adjusted cash flow provided by continuing operations
An annual statement filed by a life insurance company in each state where it does
Current Income Tax Expense
That portion of the total income tax provision that is based on
Deferred Income Tax Expense
That portion of the total income tax provision that is the result
income less income tax.
income that a company receives in the form of dividends on stock in other companies that it holds.
Earned income is generally an individual's salary or wages from employment. It also includes some taxable benefits. Earned income also includes business income if the individual is self-employed. Earned income is used as the basis for calculating RRSP maximum contribution limits.
earnings before interest and income tax (EBIT)
A measure of profit that
Cash flow plus change in present value.
Employee Retirement Income Security Act of 1974 (ERISA)
A federal Act that sets minimum operational and funding standards for employee benefit
External Financial Statements
Corporate financial statements that have been reported on by an external independent accountant.
Financial reports or statements
The Profit and Loss account, Balance Sheet and Cash Flow statement of a business.
Also called a busted convertible, a convertible security that is trading like a straight
Assets that pay a fixed-dollar amount, such as bonds and preferred stock.
The market for trading bonds and preferred stock.
A security that pays a specified cash flow over a
Net earnings after all expenses for an accounting period are subtracted from all
One who receives income from a trust.
A bond on which the payment of interest is contingent on sufficient earnings. These bonds are
Income from Continuing Operations
After-tax net income before discontinued operations,
A mutual fund providing for liberal current income from investments.
Mutual funds that seek regular income. This type of fund invests primarily in government, corporate and other types of bonds, debt securities, and other income producing securities and in certain circumstances can also hold common and preferred shares.
A form of earnings management designed to remove peaks and valleys
This is a tax planning strategy of arranging for income to be transferred to family members who are in lower tax brackets than the one earning the income, thus reducing taxes. Even though attribution rules limit income splitting, there are still a number of legitimate ways to do so, such as through the use of spousal RRSPs.
Common stock with a high dividend yield and few profitable investment opportunities.
What the business paid to the IRS.
A government tax on the income earned by an individual or corporation.
Income Tax Expense
See income tax provision.
A policy designed to lower inflation without reducing aggregate demand. Wage/price controls are an example.
income that a company receives in the form of interest, usually as the result of keeping money in interest-bearing accounts at financial institutions and the lending of money to other companies.
The revenue from a portfolio of invested assets.
Life Income Fund
Commonly known as a LIF, this is one of the options available to locked in Registered Pension Plan (RPP) holders for income payout as opposed to Registered Retirement Savings Plan (RRSP) holders choice of payout through Registered Retirement income Funds (RRIF). A LIF must be converted to a unisex annuity by the time the holder reaches age 80.
a written expression of organizational purpose that describes how the organization uniquely meets its targeted customers’ needs with its products or services
Monthly income preferred security (MIP)
Preferred stock issued by a subsidiary located in a tax haven.
GDP with some adjustments to remove items that do not make it into anyone's hands as income, such as indirect taxes and depreciation. Loosely speaking, it is interpreted as being equal to GDP.
National Income and Product Accounts
The national accounting system that records economic activity such as GDP and related measures.
The company's total earnings, reflecting revenues adjusted for costs of doing business,
The profit a company makes after cost of goods sold, expenses, and taxes are subtracted from net sales.
The excess of revenues over expenses, including the impact of income taxes.
net income (also called the bottom line, earnings, net earnings, and net
Notes to the financial statements
A detailed set of notes immediately following the financial statements in
A statement published by an issuer of a new municipal security describing itself and the issue
The net income of a business, less the impact of any financial activity,
Permanent Income Hypothesis
Theory that individuals base current consumption spending on their perceived long-run average income rather than their current income.
Pro forma financial statements
Financial statements as adjusted to reflect a projected or planned transaction.
RATIO OF NET INCOME TO NET SALES
A ratio that shows how much net income (profit) a company made on each dollar of net sales. Here’s the formula:
RATIO OF NET SALES TO NET INCOME
A ratio that shows how much a company had to collect in net sales to make a dollar of profit. Figure it this way:
income expressed in base-year dollars, calculated by dividing nominal income by a price index.
Registered Retirement Income Fund (Canada)
Commonly referred to as a RRIF, this is one of the options available to RRSP holders to convert their tax sheltered savings into taxable income.
A legal document that is filed with the SEC to register securities for public offering.
This is the restoration of a lapsed life insurance policy. The life insurance company will require evidence of continuing good health and the payment of all past due premiums plus interest.
the profit earned by a responsibility center that exceeds an amount "charged" for funds committed to that center
Also called economic value added. Profit minus cost of capital employed.
Residual income (RI)
The profit remaining after deducting from profit a notional cost of capital on the investment in a business or division of a business.
Restatement of Prior-Year Financial Statements
A recasting of prior-year financial statements to remove the effects of an error or other adjustment and report them on a new basis.
Also called margin income, the difference between income and cost. For a depository
Billing method in which the sales for a period such as a month (for which a customer also
Statement of cash flows
A financial statement showing a firm's cash receipts and cash payments during a
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