D076 Finance Skills for Managers
D076 Finance Skills for Managers
Study online at https://quizlet.com/_8lhyb8
1. Accounting The system of recording, reporting, and summarizing past financial information
and transactions
2. Accounts Receiv- An activity ratio found by credit sales divided by accounts receivable.
able Turnover credit sales/accounts receivable
(AR Turnover)
3. Activity Ratios A category of ratios that measure how well a company uses its assets to generate
sales or cash, showing the firm's operational efficiency and profitability.
4. Additional Funds Another name for the discretionary financing needed or external financing need-
Needed (AFN) ed. It represents the additional financing needed given a firm's expectations for
future growth.
5. Affirmative A bond covenant that describes things the company pledges itself to do in order
Covenants to protect bondholders.
6. Agency Costs Costs that are incurred when management does not act in the best interest of
shareholders
7. Agency Problem When the agent (the management) does not act in the best interest of the
principal (the owners)
8. Aggressive As- Companies or securities with beta greater than 1.
sets
9. Annual Percent- The annual interest rate that is charged for borrowing money or that is earned
age Rate (APR) through investment.
10. Annuity A stream of cash flows of an equal amount paid every consecutive period.
11. Annuity Due A series of equal payments made at the beginning of consecutive periods.
12. Asset pricing The process of valuing assets.
2025/2026
, D076 Finance Skills for Managers
D076 Finance Skills for Managers
Study online at https://quizlet.com/_8lhyb8
13. Auction Market A secondary market with a physical location and where prices are determined by
investors' willingness to pay
14. Average Collec- an activity ratio found by the number of days in a Year (365) divided by AR
tion Period (ACP) turnover.
365/AR turnover
15. Balance Sheet Using sales growth and the profit forecast to construct a pro forma balance sheet
Forecasting to understand the future implications of the sources and uses of finances.
16. Banks and Credit Receive deposits and extend loans to individuals and businesses.
Unions
17. Benchmarking The process of completing a financial analysis to compare a firm's financial
performance to that of other similar firms.
18. Beta A variable that describes how the price of a security varies with the market.
19. Bid-ask Spread The difference between the bid and ask prices that compensate the specialist for
the risk that he or she bears for willingness to provide liquidity.
20. Board of Direc- A group of people who jointly supervise the activities of an organization.
tors
21. Bond Indenture A legal contract that governs the relationship between a firm and its bondholders.
22. Bondholders A person who loans a corporation money by buying debt securities.
23. Business Finance an area of finance that deals with sources of funding, the capital structure of
corporations, the actions that managers take to increase the value of the firm to
its owners, and the tools and analysis used to allocate financial resources
24. Cannibalization The reduction in sales of a company's own products due to introduction of another
similar
2025/2026
, D076 Finance Skills for Managers
D076 Finance Skills for Managers
Study online at https://quizlet.com/_8lhyb8
25. Capital A financial asset that can be used by a firm or individual. Examples may be
machinery or cash held by a firm.
26. Capital Asset A model used to determine the required return on an asset.
Pricing Model
(CAPM)
27. Capital Budget- The process of evaluation and planning for purchases of long-term assets.
ing
28. Capital budget- Metrics and calculations used to determine whether a project or asset will add
ing criteria value and be a worthwhile investment.
29. Capital Markets A type of financial market used for long-term assets that are held for greater that
one year.
30. Capital Structure The mixture of debt and equity used to finance a firm.
31. Capital-Con- when a limited amount of funds are available
strained
environment
32. Cash budgets a plan for controlling cash inflows and outflows business to balance income with
expenditures
33. Cash Manage- managing the day-to-day finance operations of a firm
ment
34. Central Banks Ensure that a nation's economy remains healthy by controlling the amount of
money circulating in the economy
35. Common Stock A type of stock that represents equity in a firm and confers the right to vote at
shareholder meetings.
2025/2026
D076 Finance Skills for Managers
Study online at https://quizlet.com/_8lhyb8
1. Accounting The system of recording, reporting, and summarizing past financial information
and transactions
2. Accounts Receiv- An activity ratio found by credit sales divided by accounts receivable.
able Turnover credit sales/accounts receivable
(AR Turnover)
3. Activity Ratios A category of ratios that measure how well a company uses its assets to generate
sales or cash, showing the firm's operational efficiency and profitability.
4. Additional Funds Another name for the discretionary financing needed or external financing need-
Needed (AFN) ed. It represents the additional financing needed given a firm's expectations for
future growth.
5. Affirmative A bond covenant that describes things the company pledges itself to do in order
Covenants to protect bondholders.
6. Agency Costs Costs that are incurred when management does not act in the best interest of
shareholders
7. Agency Problem When the agent (the management) does not act in the best interest of the
principal (the owners)
8. Aggressive As- Companies or securities with beta greater than 1.
sets
9. Annual Percent- The annual interest rate that is charged for borrowing money or that is earned
age Rate (APR) through investment.
10. Annuity A stream of cash flows of an equal amount paid every consecutive period.
11. Annuity Due A series of equal payments made at the beginning of consecutive periods.
12. Asset pricing The process of valuing assets.
2025/2026
, D076 Finance Skills for Managers
D076 Finance Skills for Managers
Study online at https://quizlet.com/_8lhyb8
13. Auction Market A secondary market with a physical location and where prices are determined by
investors' willingness to pay
14. Average Collec- an activity ratio found by the number of days in a Year (365) divided by AR
tion Period (ACP) turnover.
365/AR turnover
15. Balance Sheet Using sales growth and the profit forecast to construct a pro forma balance sheet
Forecasting to understand the future implications of the sources and uses of finances.
16. Banks and Credit Receive deposits and extend loans to individuals and businesses.
Unions
17. Benchmarking The process of completing a financial analysis to compare a firm's financial
performance to that of other similar firms.
18. Beta A variable that describes how the price of a security varies with the market.
19. Bid-ask Spread The difference between the bid and ask prices that compensate the specialist for
the risk that he or she bears for willingness to provide liquidity.
20. Board of Direc- A group of people who jointly supervise the activities of an organization.
tors
21. Bond Indenture A legal contract that governs the relationship between a firm and its bondholders.
22. Bondholders A person who loans a corporation money by buying debt securities.
23. Business Finance an area of finance that deals with sources of funding, the capital structure of
corporations, the actions that managers take to increase the value of the firm to
its owners, and the tools and analysis used to allocate financial resources
24. Cannibalization The reduction in sales of a company's own products due to introduction of another
similar
2025/2026
, D076 Finance Skills for Managers
D076 Finance Skills for Managers
Study online at https://quizlet.com/_8lhyb8
25. Capital A financial asset that can be used by a firm or individual. Examples may be
machinery or cash held by a firm.
26. Capital Asset A model used to determine the required return on an asset.
Pricing Model
(CAPM)
27. Capital Budget- The process of evaluation and planning for purchases of long-term assets.
ing
28. Capital budget- Metrics and calculations used to determine whether a project or asset will add
ing criteria value and be a worthwhile investment.
29. Capital Markets A type of financial market used for long-term assets that are held for greater that
one year.
30. Capital Structure The mixture of debt and equity used to finance a firm.
31. Capital-Con- when a limited amount of funds are available
strained
environment
32. Cash budgets a plan for controlling cash inflows and outflows business to balance income with
expenditures
33. Cash Manage- managing the day-to-day finance operations of a firm
ment
34. Central Banks Ensure that a nation's economy remains healthy by controlling the amount of
money circulating in the economy
35. Common Stock A type of stock that represents equity in a firm and confers the right to vote at
shareholder meetings.
2025/2026
