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Definition of Will
This is a legal document detailing how you want your assets to be distributed upon your death. You may also stipulate how you wish to be buried or who you would like to take care of any surviving dependent family members. In my opinion, it is very important to be quite specific about your wishes for the distribution of special assets such as the antique grandfather clock, the classic silver tea set or the antique piano. If you think that your beneficiaries may dispute how your things are to be distributed, consider stipulating that an auction be held in which all beneficiaries may bid on the item which they value and all moneys collected are then shared in the same manner in which you distributed your other liquid assets. Your might want to remember that a will is automatically revoked upon marriage unless the will specifically states that the will is made in contemplation of marriage.
Excess of the purchase price over the fair market value of the net assets acquired under purchase
The excess of the price paid to buy another company over the book value of
Intangible assets of a firm established by the excess of the price paid for the going concern over the value of its assets.
This is a will which specifically expresses the testator's desire not to be kept alive on life support machines, should the occasion arise.
A term used to describe a situation in which a business combination
Short-term, non-interest-bearing liabilities of a business
Short-term, non-interest-bearing debts owed to a
A contra-fixed asset account representing the portion of the cost of a fixed asset that has been previously charged to expense. Each fixed asset account will have its own associated accumulated depreciation account.
A contra account related to accounts receivable that represents the amounts that the company expects will not be collected.
The write-off of an asset over the period when the asset is used. This term
A 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.
The price at which a willing buyer and a willing unrelated seller would freely agree to
This is the quoted ask, or the lowest price an investor will accept to sell a stock. Practically speaking, this
Assuris is a not for profit organization that protects Canadian policyholders in the event that their life insurance company should become insolvent. Their role is to protect policyholders by minimizing loss of benefits and ensuring a quick transfer of their policies to a solvent company where their benefits will continue to be honoured. Assuris is funded by the life insurance industry and endorsed by government. If you are a Canadian citizen or resident, and you purchased a product from a member life insurance company in Canada, you are protected by Assuris.
Legislation under which interest, dividends, or capital gains earned on assets you transfer to your spouse will be treated as your own for tax purposes. Interest or dividends relating to property transferred to children under 18 also will be attributed back to you. The exception to this rule is that capital gains relating to property transferred to children under 18 will not be attributed back to you.
Refers to accounts receivable from credit sales to customers
BAN (Bank anticipation notes)
Notes issued by states and municipalities to obtain interim financing for
The risk that a firm will be unable to meet its debt obligations. Also referred to as default or insolvency risk.
An investor who believes a stock or the overall market will decline. A bear market is a prolonged period
Benchmark interest rate
Also called the base interest rate, it is the minimum interest rate investors will
This is the person who benefits from the terms of a trust, a will, an RRSP, a RRIF, a LIF, an annuity or a life insurance policy. In relation to RRSP's, RRIF's, LIF's, Annuities and of course life insurance, if the beneficiary is a spouse, parent, offspring or grand-child, they are considered to be a preferred beneficiary. If the insured has named a preferred beneficiary, the death benefit is invariably protected from creditors. There have been some court challenges of this right of protection but so far they have been unsuccessful. See "Creditor Protection" below. A beneficiary under the age of 18 must be represented by an individual guardian over the age of 18 or a public official who represents minors generally. A policy owner may, in the designation of a beneficiary, appoint someone to act as trustee for a minor. Death benefits are not subject to income taxes. If you make your beneficiary your estate, the death benefit will be included in your assets for probate. Probate filing fees are currently $14 per thousand of estate value in British Columbia and $15 per thousand of estate value in Ontario.
Beneficiary (Credit Insurance)
The person or party designated to receive proceeds entitled by a benefit. Payment of a benefit is triggered by an event. In the case of credit insurance, the beneficiary will always be the creditor.
This is the quoted bid, or the highest price an investor is willing to pay to buy a security. Practically
A street-smart term that refers to the practice by many businesses
A wholesale write-down of assets and accrual of liabilities in an effort to make the
Bill and Hold Practices
Products that have been sold with an explicit agreement that delivery
Bill of lading
A contract between the exporter and a transportation company in which the latter agrees to
Bill of materials
An itemization of the parts and subassemblies required to create a
Designing a portfolio so that its performance will match the performance of some bond index.
To obtain or receive money on loan with the promise or understanding that it will be repaid.
In the mortgage pipeline, the risk that prospective borrowers of loans committed to be
Break-even payment rate
The prepayment rate of a MBS coupon that will produce the same CFY as that of
an intentional underestimation of revenues
An investor who thinks the market will rise. Related: bear.
The risk that the cash flow of an issuer will be impaired because of adverse economic
This is an agreement entered into by the owners of a business to define the conditions under which the interests of each shareholder will be bought and sold. The agreement sets the value of each shareholders interest and stipulates what happens when one of the owners wishes to dispose of his/her interest during his/her lifetime as well as disposal of interest upon death or disability. Life insurance, critical illness coverage and disability insurance are major considerations to help fund this type of agreement.
Interest-rate option that guarantees that the rate on a floating-rate loan
Money used to purchase fixed assets for a business, such as land, buildings, or machinery. Also, money invested in a business on the understanding that it will be used to purchase permanent assets rather than to cover day-to-day operating expenses.
A purchase that has been recorded on the company books as an asset. The
cash burn rate
A relatively recent term that refers to how fast a business
Cash-flow break-even point
The point below which the firm will need either to obtain additional financing
An amount the insurance company will pay if the policyholder ends a whole life
A reduction in the likelihood one or more of the firm's claimants will be fully repaid,
A co-borrower is the secondary borrower on a borrowing account. The primary borrower will receive mailed monthly statements while the co-borrower has the option to choose whether or not he/she will also receive statements.
Interest-rate option that guarantees that the rate on a floating-rate
The risk that a foreign debtor will be unable to pay its debts because of business events,
Insurance that a construction contract will be successfully completed.
The risk that a project will not be brought into operation successfully.
an organizational strategy in which company management decides to confront, rather than avoid, competition; an organizational strategy in which company management still attempts to differentiate company
The number of shares of common stock that the security holder will receive from
The expense incurred to create and sell a product or service. If a product is not
Cost of capital
The blended cost of a company’s currently outstanding debt instruments
The risk that the other party to an agreement will default. In an options contract, the risk
Coverdell Education IRA
A form of individual retirement account whose earnings
Covered or hedge option strategies
Strategies that involve a position in an option as well as a position in the
Procedure to determine the likelihood a customer will pay its bills.
A decline in the ability or willingness of banks to lend.
Restriction of loans by lenders so that not all borrowers willing to pay the current interest rate are able to obtain loans.
Financial and moral risk that an obligation will not be paid and a loss will result.
Creditor Proof Protection
The creditor proof status of such things as life insurance, non-registered life insurance investments, life insurance RRSPs and life insurance RRIFs make these attractive products for high net worth individuals, professionals and business owners who may have creditor concerns. Under most circumstances the creditor proof rules of the different provincial insurance acts take priority over the federal bankruptcy rules.
Cumulative probability distribution
A function that shows the probability that the random variable will
Cash, things that will be converted into cash within a year (such as accounts receivable), and inventory.
Current refers to cash and those assets that will be turned
Current means that these liabilities require payment in
An entity that stands ready and willing to buy a security for its own account (at its bid price) or sell
An assessment of ability and willingness to repay a loan from anticipated future cash flow or other sources.
The amount of borrowing that leasing displaces. Firms that do a lot of leasing will be
Debt service parity approach
An analysis wherein the alternatives under consideration will provide the firm
pay related to current performance
A common term for convertible bonds because of their equity component and the
degree of operating leverage
a factor that indicates how a percentage change in sales, from the existing or current
The asset in a forward contract that will be delivered in the future at an agree-upon price.
The options available to the seller of an interest rate futures contract, including the quality
A company’s stated goal for how soon a customer order will be
An amount desired, in the sense that people are willing and able to pay to obtain this amount. Always associated with a given price.
a technique for avoiding competition by distinguishing a product or service from that of competitors through adding sufficient value (including quality and/or features) that customers are willing to pay
Insurance that pays you an ongoing income if you become disabled and are unable to pursue employment or business activities. There are limits to how much you can receive based on your pre-disability earnings. Rates will vary based on occupational duties and length of time in a particular industry. This kind of coverage has a waiting period before you can begin collecting benefits, usually 30, 60 or 90 days. The benefit paying period also varies from 2 years to age 65. A short waiting period will cost more that a longer waiting period. As well, a long benefit paying period will cost more than a short benefit paying period.
Selling something on a discounted basis is selling below what its value will be at maturity,
After a Treasury auction, there will be many new issues in dealer's hands. As those issues are
An established guide for the firm to determine the amount of money it will pay as dividends.
Documented discount notes
Commercial paper backed by normal bank lines plus a letter of credit from a
Dollar-weighted rate of return
Also called the internal rate of return, the interest rate that will make the
The extent to which the value of the firm will change because of an exchange rate change.
economic order quantity (EOQ)
an estimate of the number
In project financing, the risk that the project's output will not be salable at a price that will
The duration calculated using the approximate duration formula for a bond with an
The organizing principle of modern portfolio theory, which maintains that any riskaverse
Efficient Market Hypothesis
In general the hypothesis states that all relevant information is fully and
The risk that the ability of an issuer to make interest and principal payments will change because
The first day of trading when the seller, rather than the buyer, of a stock will be entitled to
Expected return-beta relationship
Implication of the CAPM that security risk premiums will be
An expiration cycle relates to the dates on which options on a particular security expire. A
The last day (in the case of American-style) or the only day (in the case of European-style)
Fair market value
The price that an asset or service will fetch on the open market.
The amount at which an asset could be purchased or sold or a liability incurred or
Objectives of a financial nature that the firm will strive to accomplish during the period
The risk that the cash flow of an issuer will not be adequate to meet its financial obligations.
a judgment made regarding the method
A cost that does not vary in the short run, irrespective of changes in any
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