Week 5 Flashcards
what are your responsibilities as a business owner?
keep track of accounts (receivable, payable) pay taxes (federal, state, city) keep liscenses current (DC, business) insurance plan a budget and implement plan for retirement emergency contingency plan
cash
transactions are recorded only when cash (or equivalent) is exchanged
accural
transactions are recorded when a business exchange occurs
what are your responsibilities as an associate DC?
keep track of income keep track of expenses not paid by employer keep liscence current plan for retirement plan for new practice plan and follow a budget
deferment
postpone payment for set time period for certain loans
interest is accured put paid by federal government
reasons for deferment
military duty
full-time student
forbearance
ineligible for deferment
postpone payment for set time
interest is accured and paid by you
7 Cs of credit
credit capacity capital collateral character conditions commitment
credit
must be good
problems must be explained
capacity
business must be able to support its debts and expenses and be profitable
capital
money you or your investors are putting in or equity you already have in the business
collateral
value of assets that secure the loan
character
of borrower and guarantors
conditions
economy, industry trends, or anything that will affect your business
commitment
your ability and willingness to succeed which involves guarenteeing the debt personally even if the company can’t pay it
