Tuesday, April 21, 2009

What does it mean

Over the many years I have been teaching and consulting the questions about terms used in business has often been asked. I have put together a list of commonly used business terms and phrases with their meanings. Yes, this is just like those dreaded vocabulary lists we had in school.

The good news with this list there will be not test. Just an opportunity for you to have a better understanding of what the heck I am talking about when I write articles on business. I hope it helps.

Glossary of Business
Accounting-system of managing financial activity of a business
Accounting software-automates many of the functions of business accounting
Action cycles-a system of managing tasks to complete production goals
Administrative costs-expenses related to business management
Advertising-mechanism to create awareness, educate and attract customers
Assets-items of monetary value owned by the business
At-will employment-allows employer to hire and terminate employees without cause.
Break-even-level at which business income matches expenses
Budget-a system to monitor and project business financial activity
Business expenses-costs of doing business as defined by the Internal Revenue Service
Business goals-establishing an end and a means to get there.
Business plan-a device used to map out the direction a business wants to go. Used to assess business growth and mission.
Capital-accumulated liquid and tangible assets of a business
Capital expense-costs associated with acquiring assets
Cash flow-measures income and expense trends in a business
Cash flow forecast-projects future business income and expense
Closing the sale-the final steps in selling your product or service
Compensation-financial considerations given to employees or contract labor
Consultations-used to educate and gather information from clients
Contract labor-non employees who provide specific job functions for our business
Cost of obtaining business-expenses related to attracting new and existing clients to our business
Cost of sales (COS)-expenses related to producing the products we sell
Cost of sales (COS) percentage-the portion of gross sales related to cost of sales expense
Custodial accountant-an individual who handles regular record keeping of business finances
Database-a collection mechanism to hold customer or financial data and records
Depreciation-expensing and recapturing capital investment
Depreciation rules-government regulations on the amount of capital, which can be deducted on taxes each year.
Employee Covenant-a written statement of the employees job expectations
Employee handbook-guidelines outlining expectations, responsibilities and privileges of employment
Employee orientation-a time of training for new employees
Expense budget-a system to monitor and project business costs
Financial plan-the portion of a business plan dealing with monetary goals
General expense percentage-the portion of gross sales related to operating expense
General expenses-costs related to the day- to-day operation of a business
Gross profit-total of all sales revenue
Income-money received in exchange for sale of goods or services
Income and expense projections-evaluation and visioning of financial direction of business
Invoice-an itemized list of goods sold, including price and sales terms
Job description-a detailed list of functions, duties and responsibilities of employee
Liabilities-money owed by business to others
Limited checking account-used to pay irregular expenses, (taxes, insurance, withholdings)
Managerial accountant-consultant to business on financial operation
Marketing-creating a need for product or service
Marketing calendar-a system of managing marketing plan
Marketing plan-Portion of business plan, which determines the type of business and how it is going to attract the desired clients
Mechanics of pricing-method for determining selling price
Mission Statement-a promise created by the business for how they plan to conduct their operation
Money market account-a holding account for liquid capital, including depreciation recapture
Net profit-the amount of cash from sales left after expenses have been deducted
Operating expense-costs related to conducting business regardless of sales activity
Operational productivity-level of work completed in business workflow
Overhead-expenses, which exist whether or not business activity takes place
Owner's compensation-amount business owner pays himself in form of cash and benefits
Owner's statement of values-the business owner's vision of why his business exists
Partnership marketing-sharing marketing projects with other businesses
Personnel guidelines-rules for how an employee should conduct himself or herself in the workplace
Price point-a pricing level where the product will be sold
Probationary period-often given to a new employee. It allows an employer to evaluate the employees ability to perform job functions
Product lines-the various items a business will sell categorized by likenesses
Profit and loss statement (P&L)-evaluation of income against expenses to determine financial health of a business
Promotional planner-system to manage marketing programs
Pure cash accounting-method of recording income and expenses when cash in transacted
Recapture-ability to regain value of capital items
Regular checking account-handles the day-to-day income and expense of business operation
Relationship marketing-developing clients as marketing tools
Return on investment (ROI)-the value of a business measured against it's performance
Return on investment (ROI) formula-used to determine the value of a business
Sales objections-when clients begin questioning reasons for making the purchase
Sales presentations-showing and educating client products and serviecs offered
Sales projections-analyzing sales categories and their potential growth
Statement-a summary of invoices
Tax accountant-provides assistance in preparing tax returns
Technological productivity-using automation to achieve job functions
Time management-making the optimum use of one's time
Workflow-tracking how production elements are completed

No comments: