As applied to economics, the requirement for a particular product or service in the economy. When the demand exceeds the supply, prices of the given product will tend to rise due to the relative scarcity of the product, encouraging further production and discouraging further purchases until a point of equilibrium (balance) is established. See also supply.
Customers who purchase goods or services from an organisation on credit and have an outstanding balance. An item listed among the organisations assets. Also called accounts receivable.
If a company acquires another and says the deal is ´dilutive to earnings´. it means that the resulting P/E (price/earnings) ratio of the acquired company is greater than the acquiring company. Example: Company ´A´ has an earnings per share (EPS) of Re. 1. The current share price is Rs. 10. This gives a P/E ratio of 10 (current share price is 10 times the EPS). Company ´B´ has made a net profit for the year of Rs. 20.000. If company ´A´ values ´B´ at. say. Rs. 220.000 (P/E ratio=11 [220.000 valuation/20.000 profit]) then the deal is dilutive because company ´A´ is effectively decreasing its EPS (because it now has more shares and it paid more for them in comparison with its own share price). Also see Accretive
Long-term debt divided by stockholders’ equity (net worth): the customary meaning of the term as viewed by market analysts. The amount owing to outsiders divided by stockholders; equity (net worth).
Raw, unprocessed facts. See information for contrast.
Date of Acquisition
The effective purchase date of an asset. From the date of acquisition, the asset must appear in the accounts and in financial statements, and its gradual decline in usefulness (depreciation), if any, must be offset against it. Usually, this is the date title is acquired or the burdens of ownership are assumed and the asset is in possession.
The goods or benefit received from a transaction; a bookkeeping entry or posting recording the creation of or addition to an asset or an expense, or the reduction or elimination of a liability, credit valuation account, or item of net worth or revenue; am entry on the left side of an account; the amount so recorded. The balance of an asset, expense, or debit valuation account.
The method usually followed for recording transactions Formal bookkeeping records consist of journals, ledgers or their equivalent, and supporting documents and files. These records are necessary for the purpose of giving expression promptly, systematically, and conventionally to the thousands of transactions that even a relatively small organization enters into. The ultimate repository of the amounts one of the classified pages of a ledger on which appear dates, monetary amounts and other other essential transaction data.
The process of spreading the cost of a tangible asset over the expected useful life of the asset. For example: an organisation buys a new computer and depreciates it over its five year expected useful life. See also amortisation.