BUSFIN

The process of making financial decisions that aim to maximize the value of a company for its shareholders.

Decisions made to acquire and use funds effectively, including planning, investing, and managing cash flow.

The process of obtaining funds from various sources to finance a company's operations and investments.

Funds generated internally within a business, such as profit, savings, or sale of assets. It does not lead to increased debt.

Funds obtained from outside sources, including loans, debt financing, or investments. This increases the business's debt.

Decisions related to daily management of assets and short-term operations. It involves managing working capital and short-term funds.

The owners of a corporation who hold shares and have voting rights. They receive dividends as their share of profits.

The group elected by shareholders to oversee the company's management and strategic direction. They are responsible for making decisions that benefit all shareholders.

The highest position in a corporation. They provide direction, set investment policies, approve strategies, goals, and budgets, appoint and remove top management.

Supervises the company's operations, ensures strategies are well executed, and performs various management tasks.

Short-term assets and liabilities, like inventory, receivables, cash, and short-term investments.

The process of determining how much profit is distributed to shareholders as dividends, how often, and how much is retained by the company .

A financial intermediary that links depositors with borrowers.

The person who puts money into a savings account.

The person who borrows money from a financial institution.

Contracts representing a financial asset or liability.

Selling new securities to the general public, often for the first time. Think of it as a company opening its doors to public investors allowing them to buy a piece of the business.

The initial sale of a company's stock to the public. This is when a private company decides to become a publically traded company.

Selling new securities to a specific buyer, such as an institutional investor, avoiding the process and costs of a public offering.

A marketplace where existing securities are bought and sold. It deals with the exchange of previously issued financial instruments like shares, bonds, and notes.

A collection of investments owned by many investors. It's managed professionally to diversify and potentially earn higher returns.

Financial institutions that provide protection against financial losses from events like death, illness, or accidents. They sell policies for risks such as life insurance, health insurance, or property insurance.

A market where securities with short-term maturities (generally less than a year) are traded. These include instruments like treasury bills, commercial paper, and certificates of deposit.

Funds managed by private investors. These funds have the potential to generate higher returns but also involve higher risk.

A plan that outlines how an organization will respond to a future event or situation that may or may not happen.

The process of managing credit extended to customers, ultimately impacting the quality of accounts receivable.

The length of time it takes a business to purchase inventory, sell it, and receive cash from the sale.

The willingness of a borrower to repay a loan.

A customer's ability to generate cash flows to meet their financial obligations.

An asset pledged as security for the repayment of a loan.

The financial resources available to a customer, such as their savings or investments.

The formulation and implementation of plans and policies to meet production and merchandising needs while minimizing inventory costs.

The minimum level of current assets a company needs to function based on its production capacity and sales range.

The difference between working capital and permanent working capital, representing excess funds.

A financial strategy where short-term financing covers part of permanent needs, and the rest is funded long-term.

A financial strategy where permanent needs are funded long-term, and temporary needs are funded short-term.

Institutions providing short-term loans secured by collateral, often jewelry.

The use of sales to finance the purchase of inventory.

The ability to delay payment for goods or services.

The cost of carrying inventory. It includes storage costs, insurance, and potential obsolescence.

The length of time it takes a company to convert its investments in raw materials, labor, and finished goods into cash from sales. It encompasses the time spent on acquiring raw materials, producing goods, and collecting payment from customers.

A method for managing inventory by classifying items into three categories based on their value and importance to the business. A-items are the most valuable and important, requiring close monitoring. B-items are moderately important, and C-items are the least valuable and important, requiring less attention.

The management of a company's current assets and liabilities, aiming to balance profitability and risk.

The length of time it takes a company to sell its inventory. A shorter days inventory period indicates efficient inventory management.

The average number of days it takes a company to collect payment from its customers. A shorter days receivables period indicates efficient credit and collection practices.

The average number of days it takes a company to pay its suppliers. A longer days payables period can improve cash flow.

A strategy for managing working capital. Companies can choose between a more conservative approach with more liquid assets, or a more aggressive approach with less liquid assets but higher potential returns.

Assets that are expected to be converted into cash or consumed within a year. Examples include inventory, accounts receivable, and cash.