Chapter 3 - Definitions Flashcards
Assets which will be sold, consumed or exhausted within the financial year of nirmal business operations.
Current Assets
Short-term agreement to provide goods and services for a duration.
Hire
The potential benefits forgone as a result of choosing one alternative over another.
Opportunity Cost
3E’s model
Traditionally looked at efficiency, economic and effectiveness as three ways to reduce expenditure.
Document outlining the expected minimum level of service between a service provider and a client.
Service Level Agreement
An approach that seeks to maintain equipment in perfect production condition by minimising defects, breakdowns, accidents, disruptions and incidences of having to slow down the production process.
Total Productive Maintenance
An investment appraisal method based on future cash flows and the time value of money.
Discounted Cash Flow
An accounting term for an amount in the future, adjusted to ‘today’s’ value by a calculation. This allows a comparison between different projects on the same basis.
Net Present Value
The incoterm given to a price for collection from the supplier’s location rather than delivered to the buyer’s site.
Ex-Works (EXW)
The incoterm where the goods are delivered to the buyer’s premises with all taxes and levies paid.
Delivered Duty Paid (DDP)
The incoterm that applies when the freight is put on board the shipping vessel.
Free on Board (FOB)
This means making a profit, caring for people and looking after the planet.
Triple Bottom Line
A principle of maximising reuse and value extraction of materials and products rather than disposal without consideration of outcome.
Circular Economy
