A Glossary of Business and Financial Terms
Acceptance of Offer
A buyer's agreement to purchase goods or services from a seller
Acceptance of Order
A seller's agreement to provide goods at a defined price
A unique identifier designating a particular account. Typically, the first digits indicate account group or corporation, the middle digits indicate a budget group or department, and the final two digits specify the sub-account.
Permitting account numbers to be transferred from the current fiscal year to the upcoming fiscal year. Only active accounts are rolled over, while closed, inactive, or zero-balance accounts are not.
The true balance of a checking account, after pending debits and credits have been recorded
A proceeding that transfers an account's remaining balance from the current fiscal year into the upcoming fiscal year
A group of associated accounts, typically assigned to the same business unit. Budget groups can be identified by their account numbers having the same first and middle digits.
A group of items intended to be inventoried together
The practice of removing parts from one piece of equipment for direct use on another piece of equipment
Money invested in a business, whether in the form of cash or possessions
Equipment having a certain minimum cost and having an expected service life of several years. The value of capital equipment is depreciated over time.
Sales of goods or services by a company in exchange for cash or other immediate payment (such as credit card)
An asset's value, derived from its acquisition cost and modified by its remaining useful life
Investing capital across multiple types and categories. Diversification reduces the risk of exposure to any single investment type, category, or market.
A form of signature designed to take the place of a handwritten (or "wet") signature. An electronic signature has the same legal effect as a traditional signature while being more convenient for modern business transactions.
A donation to a tax-exempt organization designed to use its earnings for future expenditures. In an endowment (as opposed to a simple donation), the principal is retained and used to generate income.
A party charged with a duty to act within the best interests of another party. A fiduciary can be a person or a company.
The total of cash on hand, disbursements, and vouchers that make up a petty cash fund
Sometimes called a tip, a gratuity is payment voluntarily given in exchange for service. The gratuity is typically over and above the standard price of the service and is intended to directly compensate a staff member (as opposed to the employer).
An asset's cost when purchased
A petty cash fund used to cover incidental expenses. Employees use a voucher system to track cash in and out of the imprest fund.
An expense that occurs when traveling on official business. This does not include common personal expenses such as meals and lodging.
The money earned by a business, including interest and dividends from investments
A unique identifier assigned to a piece of equipment for tracking purposes
Money assigned to a property, stock, or other vehicle for the purpose of growth or income
A clause added to an affidavit stating the time and place of the affidavit as well as the authority before whom the affidavit was sworn
A contract for the use of property. The lessee receives the right of use, but the lessor retains legal ownership of the property.
The ability to convert an investment to cash without significant delay or penalty
The price of a security (such as a stock) at a particular point in time
Money Market Fund
A mutual fund that invests in money market instruments. This is considered a low-risk, low-return investment vehicle.
Also known as non-productive hours, including all portions of a day other than working hours, like lunches, breaks, time off, etc.
An officer of the company who is authorized to sign legally binding accounting documents
Checks that have been written but not yet cashed
A form used to track cash in and out of an imprest fund
All investments held by a person or company
Labor that can be performed by an outside agency in a more timely, cost-effective, or skilled manner than when using company employees
An endowment that can be dissolved and returned to the donor under certain circumstances
Land and buildings owned by a person or company
An official document recording the activities of a company, person, or government agency
To repay a person in kind for expenditures they have incurred
A state tax on the sale or rental of goods and services
The ability to sign legally binding documents on behalf of a company. A person's authority may be limited to their department or budget group.
Social Security Number
A unique identifier assigned to individuals for tracking in the Social Security system
A person who wholly owns a company
Tangible Personal Property
Items that can be owned, traded, or sold
Any person or company that is not required to pay sales tax on a particular transaction
Personal expenses incurred during travel, typically including things like food and lodging
A person who wholly owns a company
A specified business group, such as a department or team
A passport stamp required for entry into a country
A day on which work is performed. The number of days may vary depending on the business type: a retail location may be open Monday through Saturday, while a hospital would typically be open seven days per week.
Also known as productive hours, these are the hours of a work day when business is conducted and an employee is scheduled to perform such work.
Further Reading for Business and Financial Information
- Library Guide for Business Students
- Glossary of Terms
- Understanding Business Jargon: An A-Z Guide
- Business Fundamentals: Understanding the Basics of Business
- The Basics of Business Success
- Fundamentals of Business Management
- What Is an MBA?
- Business Finance: Definition, Meaning, and Importance
- The Primary Areas of Business Finance
- Financial Management for a Small Business
- What Can You Do with a Business Finance Degree?