Accounting - is the process recording all the transactions of the company which affect any

investment of capital, so that at any time the results of the investments may be known.

Acid-Test Ratio - an index of short term paying ability

Amortization - is any method of repaying a debt, the principal and interest included by a series
of equal payments at equal interval of time.

Amortized Loan - a loan that is discharged or repaid by a uniform series of payments extending
over its duration.

Annuity - is a series of equal payments occurring at equal period of time.

Annuity Due - is one where the payments are made at the start of its period, beginning from the
first period
Appraiser
the person engaged int he task of valuation
Assets
anything on value that is owned by an enterprise
Authorized Capital
grand total of the assets and operational capability of the corporation
Benefit Cost Ratio
it is the ratio of the difference between the benefits and the disbenefits to the cost associated with
the particular project
Bid bulletin
additional information of perspective bidders on contract documents issued prior to the bidding
date
Bilateral Monopoly
a market situation where there is one seller and one buyer
Bilateral Oligopoly
a market situation where there are few sellers and few buyers
Bond
it is the certificate of indebtedness of a corporation usually for a period and less than 10 years
and GUARANTEED by mortgage on certain assets of a corporation of subsidiaries.
Bookkeeping
is the systematic recording of all business transactions
Book Value
it is worth the property which is listed on the book of accounts of an enterprise. iT IS
ORIGINAL COST MINUS THE TOTAL DEPRECIATION.
Borrowed Funds or Capital
are those capital supplied by others on which fixed interest must be paid and debt must be repaid
at a specific time
Break Even Point
it is the point in economic studies whreby there is no profit.
Callable Bond
a bond that contains clauses permitting repayment before maturity
Capacity or Plant Factor
it is the ratio between the average load and the total available capacity
Capital Gain
an increase in the value of a capital asset
Capital loss
the reduction in the money value of a capital asset
Capitalized Cost
is the sum of the first cost and the present worth of all costs of replacement,operation and
maintenance for a long time or forever
Cash Flow diagram
it is the graphical representation of cash flows which are drawn in time scale
Certificate of Deposit
a negotiable claim issued by a bank of lieu of term deposit
Chairman of the board
highest position in the corporation
Collateral Bond
a type of bond whose security is the stocks or bonds of a well established subsidiary of the
corporation.
Commodity
any particular raw material or primary product
Common Stock
it represents ordinary ownership without special guarantees of return
Construction Cost
it is the sum of all cost necessary to prepare a construction project for operation
Corporation
an aggregation of individuals formed for the purpose of conducting a business and recognized by
law as fictitious person
Coupon
a document that shows proof of legal ownership of a financial security
Coupon Bond
a type of bond having a coupon attached to the bond for each interest payment that will come due
during life of the bond
Currency Depreciation
it denotes the fall i the exchange rate of one currency in terms of others. The term usually applies
to floating exchange rates
Currency Devaluation
the deliberate lowering og the price of the nation's currency in terms of the accepted standard
Current Assets
this consist of cash and account receivable during the next period or any other material which
will be sold.
Current Liabilities
represents claim against owners which must be paid in the near future
Debenture Bond
a bond without any security behind it except a promise to pay on a certain date by issuing
corporation.
Declining Balance Method
a method of computing depreciation in which the annual charge is a fixed percentage of the
depreciated book value at the beginning of the year to which the depreciation applies.
Deferred Annuity
it is a series of equal payments occuring at equal interval of time where the first payment is made
after several periods , after the beginning of the period.
Deflation
reduction in the level of national income and output usuall accompanied by the fall in the general
price level.
Demand
it is the quantity of certain commodity that is brought at a certain price at a given place and time.
Demand Factor
it is the ratio between the maximum power demand and the sum of the connected loads of the
system
Demented Persons
parties whose concent or signature in a contract is not considered intelligent.
Depletion
it is the decrease in the worth or value of the property due to the gradual extraction of its contents
Depletion Cost
annual charge that is made for the maintenance of investment in wasting assets such as gas
wells,oils, mines
Depreciation
it is the decrease in value of the physical property due to the passage of time
Depreciation Cost
annual charge that is made during the period of the useful life for the services rendered by the
investment i the building, machinery and equipment in producing the products.
Depreciation Recovery
the present worth of all the depreciation over the economic life of the item
Development Cost
it is the sum of all cost incurred by an investor of a project up to the time that the project is
accepted by those who will promote it
Differential Cost
it is the ratio of a small increment of cost and a small increment of output.
Direct labor
it is the actual work applied directly in the process of manufacturing a certain product
Direct Materials
these are the materials which are included in the financial product itself
Discount
it is the difference between the present worth and the future worth of a negotiable paper.
Diversity Factor
is the ration between the sum of the maximum demands of the separate parts of the system and
the maximum demand of the entire system
Dividends
profit earned by a corporation , which is periodically distributed to the stockholders
Duopsony
a market situation where there are only two buyers with many sellers.
Economics
it is the study of the wealth, its value, creation and distribution
Economic Life
the length of time which the property may be operated at a profit
Economic Return
the profit derived from a project or business enterprise without consideration of obligations to
financial contributions or claims of other based on profit.
Effective Interest
the true value of interest rate computed by equations for compound interest for a one-year period
Effective Rate of Interest
it is the actual rate of interest on the principal for one year.
Elastic Demnad
it occurs when a decrease in selling price will cause a greater than proportionate increase in the
volume of sales
EngIneering Economy
it is the analysis and evaluation of the factors that will affect the economic success of
engineering projects to the end that a recommendation can be made which will ensure the best
use of capital
Equipment Obligations Bond
a type of bond whose guaranty is in lien on railroads equipments
Equity
is the claims of anyone against the assets of the enterprise
Escalatory Clause
the provision in the contract that indicates the possible adjustments of material cost and labor
cost.
Exact Simple Interest
an interest based on the number of days, 365 for an ordinary year and 366 days fora leap year
Face or Par Value
it is the amount stated in the bond
Fair Value
it is the value which is disinterested third party , different from buyer or seller , will determine in
order to establish a price that is fair and acceptable to both the buyer and the seller.
Fixed Assets
these assets which will not be converted into cash and account receivable during the next period
or any other material which will be sold.
Fixed Liabilities
these are the liabilities which are not due for payment until sometime more than one year distant
Forced Saving
a saving which takes place because goods are not available for consumption rather than the
consumer really want to save.
Franchise Value
is an intangible item of value arising from the exclusive right of a company to provide a specific
product
Going Value
an intangible value which is actually operating concern has due to its operation.
Goodwill Value
is that element of value business has earned through the favorable consideration and patronage of
its customers arising from it's well known and well conducted policies and operation
Gratuitous
kind of obligation which has no condition attached
Group Depreciation Method
is a method consists of the computation of a single annual depreciation charge for a group of
similar assets using their average life
Gross Margin
gross profit , sales less costs of goods sold as percentage of sales
Hard Currency
a currency traded in a foreign exchange market for which the demand is consistently high in
relation to its supply
Increment Cost
it refers to any increase in cost
Inelastic Demand
it occurs when a decrease in a selling price will cause a less than proportionate increase in sales
Interest
the amount of money paid for the use of money called a capital for a certain period of time
Interest Rate
the ratio of the interest payment to the principal for a given unit of time and usually expressed as
percentage of the principal.
Joint Bond
a type of bond issued jointly by two or more corporations.
Law of Supply and Demand
when free competition exists, the price of a product will be that value where the supply is equal
to the demand
Law of Diminishing Return
When one of the factors of production is fixed in quantity or is difficult to increase, increasing
other factors of production will result in a less proportionate increase in output.
Liabilities
are debts or the claim other than the owners upon the assets
Load Factor
is the ratio between the average demand and the amximum demand
Luxury
Capacity of commodity to satisfy human wants
Luxuries
these are the products of services that are desired by human and will be purchased if money is
available after the required necessities have been obtained
Marginal Cost
the additional cost of producing one more unit
Marginal Revenue
that amount received from the sale of an additional unit of a product
Marginal Utility
it is the ability of the last unit of the last commodity which is consumed or acquired
Market
the place where the buyers and sellers come together
Market Value
is the price a willing buyer will pay for a willing seller of the stock
Maximum Value
it is the maximum load that occurs in a certain interval of time within a given period
Monopoly
exists when a unique product is available from one seller and where new sellers are prevented
from selling the same or similar products
Monopsony
A market whereby there is only one buyer of an item which there are no good substitute
Mortgage Bond
this is the most common type of Bond.
Necessities
these are the products or services thatt are required to support human life.
Nominal Rate Of Interest
rate of interest which is specified to a certain number of periods per year
Obsolescence
this refers to changes in conditions externals to the equipment under consideration
Ordinary Annuity
the first payment is made at the end of the period
Ordinary Simple Interest
is an interest which is computed on the basis of the banker's year which is equal to 360 days
Ownership
is the equity of person who normally possesses an assets
Partnership
it is the association of two or more persons for the purpose of engaging a business for profit
Patent
exclusive right granted by the government
Perfect Competition
it occurs when a certain product is offered for sale by many vendors or suppliers and there is no
restriction
Perpetuity
is a series of equal payments which the payments continue indefinitely
Physical Inventory
Actual Counting or determination of the actual quantity pf the materials on hand as of given date
Power Factor
is the ratio of the output of the power in watts and the product of volts and amperes
Preferred Stock
represent ownership
Prepaid Expenses
these are the assets in the form of money paid for certain materials not yet delivered or services
not et rendered to the company
Prepaid Income
this arises when abusiness receives payment for a service before it actually renders service
Present Worth Factor
mathematical equation also known as the present value of an annuity of one
Prime Cost
the sum of the direct labor costs and the direct material cost
Private
type of ownership in business where individuals exercise and enjoys the right in their interest
Proprietorship
is the simplest form of business organization wherein the business is own entirely by one person
Rate-Base Value
is the value assigned to the property for the purpose of establishing rates
Rate of Interest
the amount earned by one unit of principal during a unit of time
Rate of Return
is the measure of the financial efficiency of the investment
Registered Bond
the owner's name is recorded in the books of corporation
Risks
the deviation of actual outcomes
Salvage Value
the amount that can be obtained from the sale after its useful life
Supply
is the quantity of certain commodity
Tort
an evil wrong commitment
utility
is the capacity of commodity to satisfy human want
variable cost
cost that vary with the output
working capital
also known as circulating capital