• Return on Investment ROI

    Net income after interest as a percentage of operating capital.

  • Return on Equity

  • Revenue

    Revenue arises when a company posts a sale to a customer, regardless of whether the customer has already paid or not.

  • Selling Expenses

    Indirect expenses for such things as marketing and sales that cannot be charged to the administrative expenses or manufacturing accounts.

  • Share

    A unit of ownership in a joint stock company. Shares of listed joint stock companies are bought and sold via stock exchanges.

  • Share Issue

    Share Issue In a share issue, the share capital (capital stock) of a joint stock company increases. It is normal to distinguish between a stock dividend and a new share issue. In the case of a stock dividend, the share capital is increased through an act of internal accounting. Normally, the accumulated retained earnings are converted into share capital. A stock dividend does not affect the financial position of the company. In a new share issue, the share capital is increased via an injection of capital by existing or new shareholders. A new share issue improves the financial position of the company and is often done when the aim is to expand the business.

  • Shareholders' Equity

    The total of shareholders' equity is equal to the difference of the company's assets and its liabilities.

  • Short-term Liabilities

    Liabilities that must be paid back within one year.

  • Standard Cost

    A precalculated specific cost per product.

  • Stock Dividend

    A way for a company to increase its share capital (capital stock) using an act of internal accounting. This can take place by for example transferring unrestricted shareholders' equity to share capital. A stock dividend does not affect the financial position of the company, but does however bind the equity closer to the company. (See also New Share Issue.)

  • Subsidiary

    A company that is at least half-owned by another company (the parent company).

  • Tangible assets

    Tangible assets are assets like inventory, machinery.

  • Tied-up Capital

    Capital that is bound up in a business in the form of for example raw materials, work in process, and accounts receivable.

  • Turnover Rate

    The turnover rate of capital is obtained by dividing the combined sales revenues for the accounting year by total capital.

  • Variable Cost

    A cost that varies with the volume of manufacturing and sales.

  • WIP

    Work in process (during manufacturing) before the value is charged to the customer order.

  • Working Capital

    The sum of inventories plus advances paid plus accounts receivable plus other bills receivable plus other receivables minus accounts payable minus other operating liabilities.

  • Yield

    Earnings that are measured in relation to invested equity or to total capital (shareholders’ equity plus borrowed capital).