Mod 3 Business Flashcards
Financial Management
All activities related to generating and raising money and using it effectively; for larger companies, usually overseen by the chief financial officer (CFO)
Dividends
Profits of the company that are distributed to the shareholders
Cash Flow
The movement of money into and out of an organization
Trade credit
Short-term financing source where a company takes delivery of goods but pays for them at a later time
Financial Plan
A plan for obtaining and using the money needed to implement an organization’s strategic and operational plans
Operating Budget
A budget of expected revenue and expenses from ongoing operations
Capital Budget
A budget of expected investments in new assets such as factories, equipment, and major expenditures for R&D
Cash Budget
An estimate of cash expenditures over a specified time period; based on operating budget, capital budget, and other information about timing of the company’s cash flow
Debt Financing
Borrowing money that must be paid back, usually with interest
Equity Finacing
Money recieved from the owners or from the sale of shares of ownership in a business
Collateral
Pledge of specific assets by the borrower to the lender’s if the borrower defaults on the repayment of the loan
Unsecured Loans
Short-term loans from a bank or financing company that are not secured by collateral
Line of Credit
A flexible borrowing options between a financial institution and its customers that allows customers to access funds at any time as long as they do not exceed the maximum amount as specified in the agreement
Secured Loans
Short-term loans from a bank or financing company that are secured by collateral
Corporate Bonds
Long-term debt obligation (liabilities) issued by corporations that prosime to make payments over a specified period
