Term
|
Definition
| consists of the current assets and the current liabilities of a business |
|
|
Term
|
Definition
| current assets (cash, marketable securities, accounts receivable, and inventory) |
|
|
Term
|
Definition
| difference between a business's total current assets and its total current liabilites |
|
|
Term
| Working capital management |
|
Definition
| ability to effectively and efficiently control current assets and current liabilities in a manner that will provide the max. return on its assets and min. payments for it's liabilities. |
|
|
Term
|
Definition
| goal to obtain highest amount of return cash possible |
|
|
Term
|
Definition
| time that elapses between payment by check and the check's actually clearing from the bank (funds taken from the account) |
|
|
Term
|
Definition
| amount of time that elapses between depositing a debtor's check in your account to when the check clears |
|
|
Term
|
Definition
| post office box opened by an agent of the bank, and checks received received are IMMEDIATELY deposited in our account |
|
|
Term
| Electronic funds transfer (EFT) |
|
Definition
| funds are immediately transferred from one bank account to another via computer. |
|
|
Term
|
Definition
| investment vehicles that include U.S. treasury bills, government and corporate bonds, and stocks. |
|
|
Term
| Accounts receivable management |
|
Definition
| Goal is to increase sales by offering credit to customers |
|
|
Term
|
Definition
| Character is favorable if that customer has paid his or her bills on time in the past and has favorable credit references from other creditors. |
|
|
Term
|
Definition
| whether the customer has enough cash flow or disposable income to pay back a loan or pay off a bill. |
|
|
Term
|
Definition
| the ability to satisfy a debt or pay a creditor by selling assets for cash. |
|
|
Term
|
Definition
| requirements that our business establishes for payment of a loan (the use of credit by a customer). |
|
|
Term
| Aging of accounts receivable |
|
Definition
| determining the amounts of accounts receivable, the various lengths of time for which these accounts have been due, and the percentage of accounts that falls within each time frame. |
|
|
Term
|
Definition
| overall goal is to minimize total inventory costs while maximizing customer satisfaction. |
|
|
Term
|
Definition
Economic Order Quantity
D-annual demand for the item
S-Total ordering cost for the item
I-Carrying cost of the item (%)
P- Unit cost of the item |
|
|
Term
|
Definition
| the items that a company uses in producing its final product. |
|
|
Term
|
Definition
| inventories are made up of those items that are being produced. |
|
|
Term
|
Definition
| inventories are made up of those items that are actually sold by the business. |
|
|
Term
Maintenance, Repair, and Operating
(MRO) |
|
Definition
| inventories are made up of those items that are used by the firm in normal operations, but are not manufactured or sold by the firm. |
|
|
Term
| Current liabilities manangement |
|
Definition
consists of minimizing our obligations and payments for short-term debt, accrued liabilities, and accounts payable. It consists of:
Short-term debt management
Accrued liabilities management
Accounts payable management |
|
|
Term
|
Definition
| business obligations that will be paid within the current accounting period. |
|
|
Term
|
Definition
| obligations of the firm that are accumulated during the normal course of business and are primarily payroll taxes and benefits, property taxes, and sales taxes. |
|
|
Term
|
Definition
| debts of a business which are owed to vendors. Vendors offer several types of discounts. |
|
|
Term
|
Definition
| amounts deducted from list prices of items when specific services are performed by the trade customer. |
|
|
Term
|
Definition
| actual percentage of the list price paid after taking all successive trade discounts |
|
|
Term
| Single equivalent discount |
|
Definition
One minus the net cost rate factor
(1-N) |
|
|
Term
|
Definition
offered to credit customers to entice them to pay promptly.
Will normally appear on an invoice in terms such as 2/10 n30 |
|
|
Term
|
Definition
| offered by vendors to increase their own cash flow when they offer discounts to customers who purchase items in large quantities |
|
|
Term
|
Definition
| are normally discounts that are offered on total purchases of an item during the vendor’s fiscal year. |
|
|
