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Definition of Wash
Gains equal losses.
The central bank of the U.S., established in 1913, and governed by the Federal
The practice of making a charge in the income account equivalent to the tax savings
A revision to the Bretton Woods international monetary system which was signed at
Schedule of depreciation rates allowed for tax purposes.
A method of constructing a replicating portfolio in which the manager purchases a
A computerized clearing system for sterling funds
An international wire transfer system for high-value
Under this currency translation method, all foreign currency balance-sheet and income
A method of cash budgeting based on detailed estimates of cash receipts and cash
Highlights the fact that return on assets (ROA) can be expressed in terms
An exchange arrangement formed in 1979 that involves the currencies
Any excess of actual reserves above required reserves.
Securities issued by corporations and agencies created by the U.S. government,
Agencies of the federal government set up to supply credit to various classes of
A federal institution that insures bank deposits.
Federal Financing Bank
A federal institution that lends to a wide array of federal credit agencies funds it
Non-interest bearing deposits held in reserve for depository institutions at their district federal
Federal funds market
The market where banks can borrow or lend reserves, allowing banks temporarily
Federal funds rate
This is the interest rate that banks with excess reserves at a federal reserve district bank
Federal Home Loan Banks
The institutions that regulate and lend to savings and loan associations. The
Federally related institutions
Arms of the federal government that are exempt from SEC registration and
The practice of reporting to shareholders using straight-line depreciation and
Freddie Mac (Federal Home Loan Mortgage Corporation)
A Congressionally chartered corporation that
Excess reserves minus member bank borrowings at the Fed.
Imputation tax system
Arrangement by which investors who receive a dividend also receive a tax credit for
Just-in-time inventory systems
systems that schedule materials/inventory to arrive exactly as they are
Log-linear least-squares method
A statistical technique for fitting a curve to a set of data points. One of the
Monetary / non-monetary method
Under this translation method, monetary items (e.g. cash, accounts
A technical trading strategy that combines mechanical rules, such as the CRISMA
Nonmarket or firm-specific risk factors that can be eliminated by diversification. Also
Holdings of gold and foreign currencies by official monetary institutions.
Progressive tax system
A tax system wherein the average tax rate increases for some increases in income but
Accounting for an acquisition using market value for the consolidation of the two entities'
The dollar amounts based on reserve ratios that banks are required to keep on deposit at a federal reserve Bank.
An accounting entry that properly reflects the contingent liabilities.
A foreign currency held by a central bank or monetary authority for the purposes of
Specified percentages of deposits, established by the federal reserve Board, that banks must
The percentage of different types of deposits that member banks are required to hold
A method of allocating the purchase price for the acquisition of another firm among the
Simple compound growth method
A method of calculating the growth rate by relating the terminal value to
Split-rate tax system
A tax system that taxes retained earnings at a higher rate than earnings that are
A method of cash budgeting that is organized along the lines of the statement of cash flows.
Common to all businesses.
Also called undiversifiable risk or market risk, the minimum level of risk that can be
Systematic risk principle
Only the systematic portion of risk matters in large, well-diversified portfolios.
Under this currency translation method, the choice of exchange rate depends on the
Two-tier tax system
A method of taxation in which the income going to shareholders is taxed twice.
Also called the diversifiable risk or residual risk. The risk that is unique to a company
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).
A set of accounts that summarize the transactions of a business that have been recorded on source documents.
Planning, programming and budgeting system (PPBS)
A method of budgeting in which budgets are allocated to projects or programmes rather than to responsibility centres.
A method of adjusting accounts receivable to the amount that is expected to be collected based on company experience.
A method of preparing the operating section of the Statement of Cash Flows that uses the company’s actual cash inflows and cash outflows.
Direct write-off method
A method of adjusting accounts receivable to the amount that is expected to be collected by eliminating the account balances of specific nonpaying customers.
A method of preparing the operating section of the Statement of Cash Flows that does not use the company’s actual cash inflows and cash outflows, but instead arrives at the net cash flow by taking net income and adjusting it for noncash expenses and the changes from last year in the current assets and current liabilities.
Periodic inventory system
An inventory system in which the balance in the Inventory account is adjusted for the units sold only at the end of the period.
Perpetual inventory system
An inventory system in which the balance in the Inventory account is adjusted for the units sold each time a sale is made.
The amount of total risk that cannot be eliminated by portfolio
The amount of total risk that can be eliminated by diversification by
actual cost system
a valuation method that uses actual direct
a process of service department cost allocation
business intelligence (BI) system
a formal process for gathering and analyzing information and producing intelligence to meet decision making needs; requires information about
a system using transfer prices; see transfer
cost control system
a logical structure of formal and/or informal
cost management system (CMS)
a set of formal methods
a service department cost allocation approach
dividend growth method
a method of computing the cost
enterprise resource planning (ERP) system
a packaged software program that allows a company to
FIFO method (of process costing)
the method of cost assignment that computes an average cost per equivalent
flexible manufacturing system (FMS)
a production system in which a single factory manufactures numerous variations
a technique used to determine the fixed
hybrid costing system
a costing system combining characteristics
job order costing system
a system of product costing used
judgmental method (of risk adjustment)
an informal method of adjusting for risk that allows the decision maker
just-in-time manufacturing system
a production system that attempts to acquire components and produce inventory only as needed, to minimize product defects, and to
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
method of least squares
see least squares regression analysis
method of neglect
a method of treating spoiled units in the
modified FIFO method (of process costing)
the method of cost assignment that uses FIFO to compute a cost per
net present value method
a process that uses the discounted
normal cost system
a valuation method that uses actual
performance management system
a system reflecting the entire package of decisions regarding performance measurement and evaluation
process costing system
a method of accumulating and assigning costs to units of production in companies producing large quantities of homogeneous products;
a production system dictated by product sales
the traditional production system in which
an inventory ordering system in which a red
responsibility accounting system
an accounting information system for successively higher-level managers about the performance of segments or subunits under the control
risk-adjusted discount rate method
a formal method of adjusting for risk in which the decision maker increases the rate used for discounting the future cash flows to compensate for increased risk
an iterative (sequential) algorithm used to solve multivariable, multiconstraint linear programming problems
a high-performance, data-driven approach to analyzing and solving the root causes of business problems
standard cost system
a valuation method that uses predetermined
a process of service department cost allocation
strict FIFO method (of process costing)
the method of cost assignment that uses FIFO to compute a cost per equivalent unit and, in transferring units from a department, keeps the
an inventory ordering system in which two
weighted average method (of process costing)
the method of cost assignment that computes an average cost per
Bootstrapping, bootstrap method
An arithmetic method for backing an
First in, first-out costing method (FIFO)
A process costing methodology that assigns the earliest
Moving average inventory method
An inventory costing methodology that calls for the re-calculation of the average cost of all parts in stock after every purchase.
A capital budgeting analysis method that calculates the amount of
An accounting method used to combine the financial statements of
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