Business Financial Terminology
Bob on The world of business finance is sometimes viewed as having its own language. While this isn’t the case entirely, there are many unique words that are used solely to describe financial terms. Because of this, its important to have a basic understanding of the terminology used in business finance.
This post looks at some of the main terms used in the business financial world.
Budget
In the financial world, a budget is an amount of money that has planned expenditure. This could be on a particular activity or resource, typically over a trading year, although budgets can apply to shorter and longer periods.
Cashflow
The movement of cash in and out of a business from direct trading and other non-trading or indirect effects, such as capital expenditure, tax and dividend payments.
Acid Test
A stern measure of a company’s ability to pay its short term debts, in that stock is excluded from asset value. (liquid assets/current liabilities) Also referred to as the Quick Ratio.
