1.

Accounts Payable (AP)

Refers to the bills (most common liabilities) that are owed and need to be
paid by a business (Clark, 2011)
2. Accounts Receivable

Refers to the debts that are owed to a business which are

typically the result of sales on credited.
 3. Assets

Refers to possessions of value owned by a business (such as inventory, cash, machinery,

equipment, and property (Allen, 2014) (Stock study, 2017)
 4. Brand

An important marketing term referring to the name of a product or organization and any
symbol or design associated with such. Used to uniquely identify and differentiate an
organizations goods and services from that of competitors.
 5. Break-even Analysis

A procedure used in business to identify how many of a given product must be

produced and sold in order for the product to pay for itself.
 6. Business Plan

A document that clarifies the details of a business venture and typically includes the vision of
the business, its status, identifies markets, and provides projections for the results of the
organization.
 7. Corporation

A legal classification for most businesses which separates the liabilities of the business from those
who actually own the business (stockholders).
 8. Capital Assets

Assets of an organization that are also known as fixed assets. They are typically long-term assets
such as facilities and equipment owned by an organization.
 9. Cost of Goods Sold

Refers to the costs of materials and production of the goods sold by a business. The costs
may include overhead, material costs, and labor costs.
 10. Diversification

A marketing technique or strategy that involves the creation of new product offerings to new
target markets. This may require the purchase of existing companies or building of new facilities
to enter the new market (for instance, an auto-maker may choose to start selling fork lifts and
golf carts).
 11. Entrepreneur

An individual who pursues opportunities and secures resources resulting in the

creation of a new business (Shim, 2014)
12. Fixed Cost

Refers to costs that do not vary with the output of products and includes costs such as
rent, overhead, and payments on loans. These costs essentially include payments
that must be made regardless of how well the business is doing.
 13. Liabilities

Money that must be paid to lenders and other organizations. Typically debt on
terms of 5 years or less is considered a short-term liability and if longer than 5 years it
is considered a long-term liability.
14. Marketing

An important activity of businesses involved with planning and directing resources to

influence the perceptions of consumers to enhance the likelihood that they will purchase
the goods and services produced by the business.
 15. Net Profit

Also known as net income or earnings, the operating income of a business after subtracting taxes
and interest. (Marriot et al, 2014)
 16. Opportunity Cost

Refers to the idea that if resources are dedicated to one activity, those resources cannot be
used for another activity. For instance, if money is dedicated to purchase new computers the
same funds cannot also be used to retool a manufacturing operation. (Elliot and Rowlands, 2006)
 17. Return On Investment (ROI)

The net profits for a project or investment divided by the total invested in the project or
investment. Thus, an ROI of 1.0 would mean the investment paid nothing. Anything over 1.0
would mean there was a return. The larger the value, the greater the return. (Shim, 2014)
18. Shareholders

Individuals or companies owning shares of stock in a company. They are typically considered
the owners of a corporation (Clark, 2014)
 19. Stakeholders

Individuals who hold some kind of a stake in an organizations activities. These typically include
shareholders, the community in which the organization resides, customers, employees, suppliers, and
other groups that can be impacted either positively or negatively. (Shim, 2014)
 20. Strategic Management

A multi-year planning process used by businesses that includes the assessment of the competitive
environment in which a given organization operates, and the formulation of strategies for
implementation. Strategies are implemented in order to achieve the organizations mission and to
ensure the companys ability to compete more effectively. (Allen, 2014)
 21. Sunk Cost

The idea that expenditures on a given activity should not be considered for the purposes of making
future decisions regarding the continuation of that activity. For instance, if a company spends a
million dollars on research and development to improve a product and that product is suddenly
made obsolete by a competitors new innovation, it may not make sense to move forward with the
improvement (Nobes, 2014)
 22. SWOT analysis

A commonly used framework for identifying where an organization stands in the competitive
marketplace and entails assessing the organizations internal strengths and weaknesses, as well as
external opportunities, and threats. (Marriot, et al 2002)
 23. Variable Cost

Costs that fluctuate based on the number of units produced. For instance, if an automaker produces
more vehicles they need to purchase more parts, more paint, hire more labor, use more energy, and
so on. Thus variable costs will increase. (Nobes, 2014)
 References

Clark, J. O. E. (2011). Dictionary of international accounting terms. Canterbury:

Financial World.
Elliott, G., & Rowlands, J. (2006). Juta's concise dictionary of accounting terms with
their Afrikaans equivalents. Kenwyn: Juta.
Shim, J. K. (2014). Dictionary of accounting terms.
Marriott, P., Edwards, J. R., & Mellett, H. (2002). Introduction to accounting.
London: SAGE.
Nobes, C. (2014). Accounting: A very short introduction.
MBENGERANWA, A. L. L. E. N. (2014). RESTAURANT FINANCIAL MANAGEMENT:
Introduction to accounting and finance for independent restaurants. S.l.: LULU
PRESS INC.