(M) Chapter 11: Financial Preparation for Entrepreneurial Ventures Flashcards
Used for safekeeping personal cash and earn (minimal) interest
Bank Accounts: Certificate of Deposit
Instrument for banks to acquire business capital and/or for further investment
Bank Accounts: Certificate of Deposit
What are the types of bank accounts?
Savings Account
Checking or Current Account
Time Depositit
Hybrid accounts (premium accounts)
Minimum Deposit/ADB for Savings
0, ₱500, ₱1000
Minimum Deposit/ADB for Checking
₱10,000
Minimum Deposit/ADB for Time Deposit Acc?
₱50k, ₱100k, ₱500k, ₱1M, ₱2M
Annual Interest Earned for Savings
0.25%, 0.5%, 1%, 1.25%, 1.5%
Annual Interest Earned for Checking
0 for most banks
Annual Interest Earned for Time Deposit
Depending on deposit and holding period
T or F: Savings, Checking, and Time Deposit have withholding tax
True (Checking, if comes with interest)
T or F: Savings, Checking, and Time Deposit can be accessed via OTC
True
T or F: Savings, Checking, and Time Deposit come with ATM cards
False (Checking: not all banks; Time Deposit: none at all)
T or F: Savings, Checking, and Time Deposit come with passbooks
True
T or F: Savings, Checking, and Time Deposit can be accessed online
False (There is no online banking for time deposit) edit: hndi ba to not for all banks lang
What is the withholding period of Time Deposits?
Days: 30, 60, 90, 180
Years: 1, 5, 10
T or F: There is a pre-termination fee in Checking accounts
False (Time Deposit accounts)
All-in-one savings, current, and time deposit. (Commonly offered by international banks. Seldom, by local banks.)
Money Market Accounts
ADB for Money Market Accounts
₱100,000
T or F: You can access Money Market Accounts through OCT-passbook, ATM, online, but not chequebook
False (you can also access it thru checkbook
Type of account where interest is tiered depending on ADB
Money Market Account
T or F: Money Market Accounts are not subject to withholding tax
False
Type of account where interest is tiered depending on currency
Foreign Currency Accounts
Minimum deposit for Foreign Currency Accounts
Differ per country
T or F: Foreign Currency Accounts are subject to withholding tax
True
T or F: Foreign Currency Accounts can be accessed thru OTC-passbook, chequebook, ATM, online
True
Represent shares of ownership (equity) of a (publicly traded) corporation — thus, stockholders become partial owners of the company
Stocks
Stocks represent ____________ (equity) of a (publicly traded) corporation — thus, stockholders become ____________ of the company
shares of ownership, partial owners
Refers to when a corporation goes public, i.e. starts selling stocks
IPO (Initial Public Offering)
Types of shares to invest on
Common Stock
Preferred Stock
Type of stocks: high risk, high return depending on the stock market fluctuations
Common Stock
Type of stock: usually fixed returns, thus, low risk and low return
Preferred Stock
Refers to purchase and selling price of stocks
Stock Price
Refers to number of shares of stock
Stock Volume
Refers to the currency value of shares of stock
Stock Value
Refers to earnings of the company shared to stockholders
Dividends
Price to Earnings Ratio (PIE Ratio); could mean overvalued, bought a lot, or good earnings
High
Price to Earnings Ratio (PIE Ratio); stocks are not popular or earnings could be low
Low
Price to Earnings Ratio (PIE Ratio); usu. no earnings and not displayed
Negative
Dividend Yield; earnings are high and/or company pays high dividends
High
Dividend Yield; earnings are low or company pays low dividends
Low
Securities sold (issued) by corporations, financial institutions or the government to interested investors (bondholders)
Bonds
Refers to price of bond at initial purchase; amount to be returned upon maturity of the bond.
Face Value (Par Value)
Refers to interest paid once or several times for a bond a year until maturity.
Coupon
Financial Statement Analysis; Each item in the income statement is found as a % of Total Assets.
Vertical Analysis
Financial Statements Analysis; Trending or comparison of current vertical analysis with previous years’.
Comparative Analysis
Financial Analysis Statements; Computation of growth rates (or %change) of items in the I/S.
Horizontal Analysis
