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Definition of Sales-type lease
An arrangement whereby a firm leases its own equipment, such as IBM leasing its own
lease accounting used by a manufacturer who is also a lessor. Up-front gross
Administrative proceedings or litigation releases that entail an accounting or auditing-related violation of the securities laws.
The lease payment at which a party to a prospective lease is indifferent between
A lease obligation that has to be capitalized on the balance sheet.
A lease in which the lessee obtains some ownership rights over the asset
One where substantially all of the benefits and risks of ownership are transferred to the lessee. It must be reflected on the company's balance sheet as an asset and corresponding liability.
Similar to equipment trust certificates except that the lender is either the
The formal name for the load of a back-end load fund.
A lease's internal rate of return.
The manufacture or purchase price of goods sold in a period or the cost of providing a service.
The average number of days' worth of sales that is held in inventory.
Average collection period.
lease in which the lessor purchases new equipment from the manufacturer and leases it to the
A U.S. corporation that receives a tax incentive for
A cross-border lease in which the disparate rules of the lessor's and lessee's countries let
Long-term, non-cancelable lease.
lease in which the service provided by the lessor to the lessee is limited to financing equipment. All other responsibilities related to the possession of equipment, such as maintenance, insurance, and taxes, are borne by the lessee. A financial lease is usually noncancellable and is fully paid out amortized over its term.
Foreign Sales Corporation (FSC)
A special type of corporation created by the Tax Reform Act of 1984 that
See: financial lease.
Also called rental lease. lease in which the lessor promises to maintain and insure the
The total sales recorded prior to sales discounts and returns.
A long-term rental agreement, and a form of secured long-term debt.
Long-term rental agreement.
Lease (Credit Insurance)
Contract granting use of real estate, equipment or other fixed assets for a specified period of time in exchange for payment. The owner or a leased property is the lessor and the user the lessee.
The consideration paid by the lessee to the lessor in exchange for the use of the leased equipment/property. Payments are usually made at fixed intervals.
The payment per period stated in a lease contract.
The payment per period stated in a lease contract.
This is any upgrade to leased property by a lessee that will be
The cost of improvements made to property that the company leases.
A lease arrangement under which the lessor borrows a large proportion of the funds needed
Limitation on sale-and-leaseback
A bond covenant that restricts in some way a firm's ability to enter into
Official SEC record of a settlement or a hearing scheduled before a civil
A lease arrangement under which the lessee is responsible for all property taxes, maintenance
Total revenue, less the cost of sales returns, allowances, and discounts.
NET SALES (revenue)
The amount sold after customers’ returns, sales discounts, and other allowances are taken away from
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.
Short-term, cancelable lease. A type of lease in which the period of contract is less than the
The rental of an asset from a lessor, but not under terms that would
One where the risks and benefits, as well as ownership, stays with the lessor.
percentage of sales models
Planning model in which sales forecasts are the driving variables and most other variables are
Price/sales ratio (PS Ratio)
Determined by dividing current stock price by revenue per share (adjusted for stock splits).
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:
return on sales
This ratio equals net income divided by sales revenue.
Safe harbor lease
A lease to transfer tax benefits of ownership (depreciation and debt tax shield) from the
Sale and lease-back
Sale of an existing asset to a financial institution that then leases it back to the user.
Sale and Leaseback
An agreement in which the owner of a property sells that property to a person or institution and then leases it back again for an agreed period and rental.
Amounts earned by the company from the sale of merchandise or services; often used interchangeably with the term revenue.
A reduction in a price that is allowed by the seller, due to a problem
The fee charged by a mutual fund when purchasing shares, usually payable as a commission to
A reduction in the price of a product or service that is offered by the
A contra account that offsets revenue. It represents the amount of the discounts for early payment allowed on sales.
A key input to a firm's financial planning process. External sales forecasts are based on
A journal used to record the transactions that result in a credit to sales.
The mix of product/services offered by the business, each of which may be aimed at different customers, with each product/service having different prices and costs.
the relative combination of quantities of sales of the various products that make up the total sales of a company
A contra account that offsets revenue. It represents the amount of sales made that were later returned.
Sales Revenue Revenue recognized from the sales of products as opposed to the provision of
A tax levied as a percentage of retail sales.
Sales value at split-off
A cost allocation methodology that allocates joint costs to joint
sales value at split-off allocation
a method of assigning joint cost to joint products that uses the relative sales values of the products at the split-off point as the proration basis; use of this method requires that all joint products
A contract that qualifies as a valid lease agreement under the Internal Revenue code.
The classification of an option contract as either a put or a call.
A double bottom where the price or indicator chart has the appearance of a W.
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