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Definition of Spin-offSpin-offA company can create an independent company from an existing part of the company by selling or
Related Terms:"Soft" Capital RationingCapital rationing that under certain circumstances can be violated or even viewed Absolute AdvantageThe ability to produce a good or service with fewer resources than competitors. See also comparative advantage. Absolute priorityRule in bankruptcy proceedings whereby senior creditors are required to be paid in full Absolute Right of ReturnGoods may be returned to the seller by the purchaser without restrictions. Absorption costingA method of costing in which all fixed and variable production costs are charged to products or services using an allocation base. absorption costinga cost accumulation and reporting Absorption costingA methodology under which all manufacturing costs are assigned ![]() Accounting insolvencyTotal liabilities exceed total assets. A firm with a negative net worth is insolvent on acid test ratio (also called the quick ratio)The sum of cash, accounts receivable, and short-term marketable administrative departmentan organizational unit that performs management activities benefiting the entire organization; American sharesSecurities certificates issued in the U.S. by a transfer agent acting on behalf of the foreign Authorized sharesNumber of shares authorized for issuance by a firm's corporate charter. Authorized sharesThe number of shares of stock that the company is legally authorized to sell. Blue-chip companyLarge and creditworthy company. Canadian Life and Health Insurance Association (CLHIA)An association of most of the life and health insurance companies in Canada that conducts research and compiles information about the life and health insurance industry in Canada. Collection DepartmentAn internal department within a company staffed by specialists in collecting past due accounts or accounts receivable. ![]() Common SharesAre equity instruments that take no security against assets, have no fixed terms of repayment and pay no fixed dividends. Company AcquisitionsAssets acquired to create money. May include plant, machinery and equipment, shares of another company etc. company cost of capitalExpected rate of return demanded by investors in a company, determined by the average risk of the company’s assets and operations. Company-specific riskRelated: Unsystematic risk Companyspecific RiskSee asset-specific risk Comparison universeThe collection of money managers of similar investment style used for assessing ConsolA type of bond that has an infinite life but is not issued in the U.S. capital markets. Consolidated Omnibus Budget Reconciliation Act (COBRA)A federal Act ConsolidationThe combining of two or more firms to form an entirely new entity. ConsolidationA summarization of the financial statements of a parent company and Consortium banksA merchant banking subsidiary set up by several banks that may or may not be of the ![]() Cost company arrangementArrangement whereby the shareholders of a project receive output free of Cost of goods soldThe cost of merchandise that a company sold this year. For manufacturing companies, the cost of raw Cost of goods soldSee cost of sales. Cost of goods soldThe cost of the items that were sold during the current period. Cost of goods soldThe accumulated total of all costs used to create a product or service, Cost of goods soldThe charge to expense of the direct materials, direct labor, and Cost of limited partner capitalThe discount rate that equates the after-tax inflows with outflows for capital Counterpart itemsIn the balance of payments, counterpart items are analogous to unrequited transfers in the CounterpartiesThe parties to an interest rate swap. Counterparty Partyon the other side of a trade or transaction. Counterparty riskThe risk that the other party to an agreement will default. In an options contract, the risk Crossover rateThe return at which two alternative projects have the same net present value. Deductive reasoningThe use of general fact to provide accurate information about a specific situation. Departmental stocksThe informal and frequently unauthorized retention of excess inventory on the shop floor, which is used as buffer safety stock. Depository Trust Company (DTC)DTC is a user-owned securities depository which accepts deposits of Doctrine of sovereign immunityDoctrine that says a nation may not be tried in the courts of another country Employee stock ownership plan (ESOP)A company contributes to a trust fund that buys stock on behalf of Employee Stock Ownership Plan (ESOP)a profit-sharing compensation program in which investments are made in Employee Stock Ownership Plan (ESOP)A fund containing company stock and owned by employees, paid for by ongoing contributions by the employer. enterprise resource planning (ERP) systema packaged software program that allows a company to Enterprise resource planning systemA computer system used to manage all company feasible solutiona solution to a linear programming problem Finance Companycompany engaged in making loans to individuals or businesses. Unlike a bank, it does not receive deposits from the public. Flat price (also clean price)The quoted newspaper price of a bond that does not include accrued interest. Fully diluted earnings per sharesEarnings per share expressed as if all outstanding convertible securities General partnerA partner who has unlimited liability for the obligations of the partnership. General partnershipA partnership in which all partners are general partners. Government National Mortgage Association (Ginnie Mae)A wholly owned U.S. government corporation Government sponsored enterprisesPrivately owned, publicly chartered entities, such as the Student Loan Guaranteed RenewalA promise that a life insurance policy will be renewed without penalty or medical examination after the term has expired. The renewal rate can also be guaranteed. Holding companyA corporation that owns enough voting stock in another firm to control management and Independent BrokerThis is a provincial government licensed independent businessperson who usually represents five or more life insurance companies in a sales and service capacity and who is paid a commission by those life insurance companies for sales and service of life insurance products. We for example, have been in business for 12 years and regularly place new business with over twenty different life insurance companies. Independent projectA project whose acceptance or rejection is independent of the acceptance or rejection of independent projectan investment project that has no specific Independent ProjectsA situation where an increase (or decrease) in the benefits of one independent variablea variable that, when changed, will Inductive reasoningThe attempt to use information about a specific situation to draw a conclusion. Insolvency riskThe risk that a firm will be unable to satisfy its debts. Also known as bankruptcy risk. InsolventA firm that is unable to pay debts (liabilities are greater than assets). Insurance CompanyA firm licensed to sell insurance to the public. Intercompany loanLoan made by one unit of a corporation to another unit of the same corporation. Intercompany transactionTransaction carried out between two units of the same corporation. ISO 14000a series of international standards that are designed ISO 9000a comprehensive series of international quality standards Issued sharesThe number of shares that the company has sold to the public. issued sharesshares that have been issued by the company. Labour-Sponsored Venture FundsVenture capital corporations established by labour unions. They function as other venture capital corporations but are subject to government regulation. LessorAn entity that leases an asset to another entity. LessorAn entity that leases an asset to another entity. LessorThe entity that rents property that it owns to a second party in exchange for a LessorA person who grants a lease; the owner of the asset. Limitation on merger, consolidation, or saleA bond covenant that restricts in some way a firm's ability to limited liability companyan organizational form that is a hybrid of the corporate and partnership organizational limited liability partnershipan organizational form that is a hybrid of the corporate and partnership organizational Limited partnerA partner who has limited legal liability for the obligations of the partnership. Limited partnershipA partnership that includes one or more partners who have limited liability. Limited partnershipA partnership that includes one or more partners who have limited liability. Management/closely held sharesPercentage of shares held by persons closely related to a company, as Manufacturing resource planningAn integrated, computerized system for planning manufacturing resource planning (MRP II)a fully integrated materials requirement planning system that involves Manufacturing resource planning (MRP II)An expansion of the material requirements planning concept, with additional computer-based capabilities in the areas of Master limited partnership (MLP)A publicly traded limited partnership. National Futures Association (NFA)The futures industry self regulatory organization established in 1982. net income (also called the bottom line, earnings, net earnings, and netoperating earnings) New ClassicalsEconomists who, like classical economists, believe that wages and prices are sufficiently flexible to solve the unemployment problem without help from government policy. New-issues marketThe market in which a new issue of securities is first sold to investors. New KeynesiansEconomists who, like Keynes, believe that for good reason wages and prices are sticky and so prolong recessions, suggesting a need for government policy. New moneyIn a Treasury auction, the amount by which the par value of the securities offered exceeds that of New York Stock Exchange (NYSE)Also known as the Big Board or The Exhange. More than 2,00 common Non-participating PolicyA type of insurance policy or annuity in which the owner does not receive dividends. Nonsignificant part numberAn identifying number assigned to a part that conveys ObsolescenceThe reduction in utility of an inventory item or fixed asset. If it is an Obsolete inventoryparts not used in any current end product. Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |