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Key Terms (A-C)

B | C
Accounting
A business system of recording and summarizing business and financial transactions. "We'll have to approve that invoice for accounting to pay it"

Accounts Payable
An accounting function that responds to invoices or other requests for payment due from outside sources of goods or dervices. "Hello, this is the accounts payable department. We have money to pay you on your invoice."

Accounts Receivable
An accounting function that collects monies due from purchasers of your companies goods or services. "Hello, this is accounts receivable. You owe us money. Please don't hang up."

Accruals
In accounting, claims to payment that have not yet been paid but appear on the books as obligations. "Our accruals are going to level out our income for July."

Acronyms
A shortened form of longer names for processes, groups, materials. Rampant in most businesses because it shortens communication time. "B2B is an acronym for Business-to-Business, as differentiated from B2C, which means Business-to-Consumer."

Advertising
Display or discusses your products to customers, by print, radio, TV, Internet or other media such as posters. "If we advertise on the Internet, do our potential customers have computers?"

Afford
To have the ability to buy."Can the people who need our product most afford to buy it?"

After-Tax
Refers to income as it will appear after appropriate taxes have been levied. "It seems like we’ve made a lot, but what will our after-tax profits be?"

Agenda
A detailed plan for a meeting or other group activity. More broadly, a day plan or set of objectives. "The third item on our agenda will be a coffee break."

Amortize
Pay out over time. " We will be able to amortize the cost of equipment over five years and, in that time, it will make us a lot of money."

Attrition
A normal reduction in employees usually as a result of resignation, retirement, or death. "We won’t have to lay off people next year because we will lose a fair number by normal attrition."

Asset
An item of value owned by your company. Also, as an analogy we sometimes speak of employees as “human assets." “This building we own is one of our major assets."

B | Top | C

Barrier to Entry
A factor which can prevent a competitor from selling or producing products in your market, i.e. a patent. "The proprietary database of satisfied customers we developed over years is a barrier to entry to new competitors."

Bellwether
Early adopter of a new product or system. "It’s a new product that we should introduce first in wired, bellwether cities like Seattle."

Before-tax
Refers to income as it will appear before appropriate taxes have been levied. "I wish we could give out dividends based on before-tax income."

Booming
A business that is making profits quickly. "Our business is booming, so we can start thinking about hiring a few more people."

Bootstrap
Start with little or nothing in income or assets. "He’d rather bootstrap his company than tie himself down with loans."

Brainstorm
In a meeting or other forum to assemble ideas, brainstorming is a request for free association of ideas from the participants. "Let’s brainstorm this problem and see if we are missing an entirely different set of solutions."

Brand
The name by which product or companies become known "People tend to buy from companies they’ve heard of, so advertising will help that brand awareness."

Break Even
When sales make up for money spent. "The Company just broke even the last quarter, but this quarter we’ll see an up tick."

Bribe
Offering gifts or money to get special favors from government officials "Certain of our large presents to the town council members may have seemed like bribes."

Budget
A plan to spend money in parts of an organization. "In this year’s budget, everyone will get a new cell phone."

Business Model
A specifically focused plan and process for the generation of profits and growth. "Having a bread company on the side is not part of our business model."

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Calendar Year
Dealing with events that must correspond to the calendar, such as taxes, as opposed to the Fiscal year in which accounts are reconciled, or the birth year of a given individual which determines his or her age. "We’ve got to renew that delivery vehicle license every calendar year."

Cancel
To stop a process which was agreed to earlier. "We’ll have to cancel those shipments if we can’t pay for them."

Capital
Money for investment. "If you are already successful, then investors will come running to you with their capital."

Cash Cow
A segment of the business that provides much income in relation to low costs. "Having a cash cow like my backyard oil well allows me to sustain several small internet companies until a few become cash cows themselves."

Cash Flow
The receipt of funds from various sources, preferably profits, which allow business expenses to be paid. "We can’t really give bonuses to employees this month because of our cash flow problems."

Charge For
Ask money for payment."We never charge for repairs that are within the warranty period."

Client
A customer for an ongoing service rather than for a single product. "Lawyers have clients and doctors have patients, but it’s hard to say who is sicker."

Collateral (noun)
Something of value which is used as security, as for payment of a debt or performance of a contract. "When we borrow money to buy machinery, the machinery itself serves as collateral."

Commission
The percentage of each sale that is paid to the salesperson. "Our sales people get a low hourly wage but also a 10% commission on everything they sell."

Competition
Businesses operating with similar product in the same market as yours. "We face tough competition. Their product is just as good and costs half as much as ours."

Consumption
The total amount of a given product bought in a market. "Because we lowered our prices, the overall consumption is higher."

Contract
A firm agreement between business parties that governs all foreseeable aspects of a business relationship: usually written or but sometimes verbal. Enforcement of contracts depends on culture. "We’ll start on the project once our written contract is signed."

Contractor
A party who is not employed by a company but does specific work for that company on an hourly or task basis. "He doesn’t get any vacation days because he’s only a contractor."

Consumers
The general group of buyers of a kind of product. "Consumers are really buying a lot of ice cream this summer."

Consensus
A general agreement arrived at by most of those concerned, not a vote. "I believe there is consensus that we will have lunch brought in to the meeting today."

Co-sign
Signing a document with someone else, often as a personal guarantee of their performance. "My father will surely co-sign on my loan to get this new Ferrari."

Credit
Buying first, and paying later. "If you buy this product on credit, the payment will be due in 90 days." (Also, in accounting, the opposite of a debit. )

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