Budget planning is a critical managerial accounting function where future activities and operational plans of an organization are transformed into detailed budgets to forecast revenues, expenses, and financial goals.
A fixed assets register is a detailed record that keeps track of all the fixed assets owned by an individual or organization. It includes important information such as asset location, purchase details, useful life, and depreciation values, aiding in accurate financial reporting and asset management.
A pension plan funding instrument in which contributions paid by an employer are deposited to accumulate at interest, and an immediate annuity is purchased upon retirement for the employee. The benefit is determined by a formula and the investment earnings on funds left to accumulate at interest.
A holding company is an entity that owns other companies' outstanding stock. It typically doesn't produce goods or services itself, instead, its purpose is to own shares of other companies to form a corporate group.
Limited recourse financing, also known as project financing, involves securing loans or investments based on the projected earnings and assets of the specific project rather than the borrower's overall assets.
Microsoft PowerPoint is a presentation software that is part of the Microsoft Office suite, enabling users to create slides for various purposes, such as printed overhead projector transparencies or digital projections directly from a computer screen. It also supports the creation of coordinated speaker notes and handouts.
A notebook computer, often referred to as a laptop, is a small, portable personal computer with a clamshell form factor, suitable for mobile use.
The Profit and Loss (P & L) account is a financial statement summarizing the revenues, costs, and expenses incurred during a specific period, typically a fiscal quarter or year.
A p-value is a statistical measure that helps researchers determine the significance of their results. This value helps assess whether the observed data supports the null hypothesis or not.
Principal and Interest (P&I) refers to the two main components of a loan payment. The principal repayment decreases the loan balance, while the interest is the cost of borrowing the money.
In corporate mergers and acquisitions, the Pac-Man Defense refers to a defensive strategy where the target company aims to counter the hostile takeover attempt by making a bid to acquire the aggressor.
A pacesetter is something that sets the standard for others to follow, often in industries such as fashion, technology, or business processes. It signifies innovation and leadership that others aim to imitate or exceed.
Package bands are strips of paper or other materials printed with advertisements, announcements, or special price offers, which are wrapped around a product package.
A Package Code is an identification code used by direct marketers to track and compare the effectiveness of different mailing packages, particularly when testing new promotional packages against control packages.
Package design refers to the comprehensive process of planning and fashioning the form and structure of a product's package. This includes various elements such as size, shape, color, closure, appearance, protection, economy, convenience, labeling, and environmental impact.
A package mortgage is an arrangement whereby the principal amount loaned is increased because personalty, such as appliances, as well as realty, serve as collateral.
Consumer products that are pre-packaged by manufacturers and sold through retail outlets, commonly including food, tobacco, toiletries, health and beauty aids, and household products.
Packaging laws are regulations set to govern the packaging process, materials, safety standards, and labeling requirements to ensure consumer protection and environmental sustainability.
A packet is a unit of data sent across a network. When a large block of data is to be sent over a network, it is broken up into several packets, which are then sent separately and reassembled at the destination.
A packing list is a detailed statement of the contents of a container, typically included within the container, used for counting and matching quantities of merchandise by the person who opens the container.
Padding refers to the practice of adding unnecessary material or expenses for the purpose of increasing the size or volume, such as padding an expense account to increase the company's reimbursement.
A measure of the speed of printers indicating how many pages a printer can produce in one minute.
Pagination is the process of dividing a document into discrete pages, a crucial element in both digital and printed text management.
A status indicating whether and how an order was paid. Status types include cash order, paid credit order, credit card order, claims-paid complaint, unpaid credit order, and complimentary subscription.
Paid-in capital represents the amount of money a company has received from shareholders in exchange for shares of stock, encompassing the funds received from stock issuance, premiums or discounts on stocks sold, stock donations, and the resale of treasury stock.
Paid-In Capital Surplus represents capital received from investors in exchange for stock. It is distinguished from capital generated from earnings or donations and includes capital stock and contributions from stockholders that are credited to accounts other than capital stock, such as an excess over par value.
A life insurance policy in which all premiums have been paid. These policies require premium payments for a limited number of years, and once all premiums have been paid, the policy is considered fully funded and requires no more payments. The policy remains active until the insured dies or cancels the policy.
Paid-up share capital refers to the proportion of issued share capital of a company that has been fully paid for by its shareholders, meaning the company has received the full payment for the shares.
Painting the tape is an illegal practice in stock market manipulations, where traders create artificial trading activity to deceive other investors. This leads to unwarranted price movements and can lure unsuspecting investors into making trades based on fabricated market interest.
Paired shares, also known as Siamese shares or stapled stock, refer to the common stocks of two companies under the same management that are sold as a unit, usually appearing as a single certificate printed front and back.
Panic buying or selling involves a flurry of transactions characterized by high volume. This phenomenon occurs in response to news events that hint at sharply rising or falling prices, often leaving investors with inadequate time to assess the fundamentals of individual stocks or bonds.
Credit given, evidenced by a written obligation that is backed by property; slang for debt, often used in contexts such as seller financing.
Paper gold refers to certificates that can be converted into gold at the offices of the issuer, whether private or government. It is often used in exchange due to its convenience over the physical metal.
Certificates issued by government (and, at times, private entities) that are generally accepted within the economy as reliable media of exchange.
Paper profit refers to an increase in the value of an asset that is recorded in the books but has not been realized through a sale. It's a theoretical gain that can fluctuate greatly before any actual profit is recognized.
Unrealized gain (loss) in an investment or portfolio, calculated by comparing the current market price to the investor's cost.
A paper trail encompasses the physical or digital documentation that records the sequence of activities and transactions, serving as a crucial mechanism for tracking and verifying the authenticity of business processes and financial records.
Equal to the established value; face amount or stated value of a negotiable instrument, stock, or bond, and not the actual value it would receive on the open market. Bills of exchange, stocks, and similar instruments are at par when they sell for their stated value.
A par bond is a bond that is selling at its nominal value or face value. This reflects a situation where the bond's market price is equal to its face value, indicating a good balance between supply and demand as well as market optimism regarding its returns.
Par value, also known as face value or nominal value, is the minimum price at which shares or other securities are issued and can be redeemed. The par value is typically set by the company at the time of issuance and does not fluctuate.
A paradigm shift refers to a fundamental change in a model or pattern that has been nearly universally accepted. It often marks a significant transformation in the way processes or concepts are understood or executed.
The Paradox of Thrift is the proposition that increased saving by households reduces their consumption and, consequently, reduces Gross Domestic Product (GDP).
The 'paradox' that many absolute essentials to life (water, air, etc.) are either free or very cheap, while many 'unnecessary' goods are quite expensive (diamonds, truffles, etc.).
A paralegal is a professional employed by a law office to perform various tasks that support the legal practice, but who is not licensed to practice law.
A parallel hedge involves mitigating exposure to fluctuations in one foreign currency by using a second currency expected to move similarly.
A financial arrangement in which two independent firms with subsidiaries in separate countries make offsetting loans to each other's subsidiaries to hedge against exchange rate fluctuations.
A parallel port is an output device that allows a computer to transmit data to another device using parallel data transmission—several bits sent simultaneously over separate wires. PC parallel ports are usually designated as LPT1, LPT2, and so on. This is in contrast to a serial port, which transmits data sequentially, one bit at a time.
A parallel printer is a type of printer that connects to a computer using a parallel port, allowing for faster data transfer rates compared to serial connections.
Parallel processing refers to the simultaneous performance of two or more tasks by a computer, which increases processing speed and efficiency, allowing for more complex computations to be done in a shorter amount of time.
A parameter is a measure used to describe a population, such as the number of rental units in a given city. Parameters are known for certain, whereas estimates are derived from samples.
A 'Parcel' can refer to a piece of property under one ownership, a package sent through a common carrier, or the act of distributing items.
Parcel Post is a class of mail service offered by the U.S. Postal Service (USPS) for mailing merchandise or printed matter weighing more than 16 ounces. Specific guidelines apply regarding the inspection, weight, and dimensions of the packages.
Pareto's Law, also known as the 80-20 Rule, posits that roughly 80% of effects come from 20% of the causes. In economics, it highlights income distribution where a small percentage of the population controls the majority of the income. This principle is essential for understanding resource allocation, inequality, and economic strategies for improving the lot of the poor.
Parity is a method used in computing and telecommunications to check whether data has been transmitted or stored correctly by ensuring an odd or even number of bits.
A parity price is a price for a commodity or service, pegged to another price or a composite average of prices from a selected prior period. The parity is typically indexed on a scale where 100 represents parity.
Parking refers to the strategy of placing assets in a safe and liquid investment temporarily while evaluating other investment opportunities.
Parkinson's Law, formulated by C. Northcote Parkinson, posits that work expands to fill the time available for its completion and that organizations become inefficient over time due to internal pressures and redundant bureaucracy.
A formal procedure followed in the conduct of any meeting, usually adhering to Robert's Rules of Order. It ensures the orderly and efficient management of the meeting's agenda.
Part-time employment refers to jobs requiring less than a full-time commitment from employees. Part-time employees typically do not enjoy the same benefits as full-time employees, such as health insurance and retirement plans.
In finance, partial delivery occurs when a broker or seller fails to deliver the full quantity of a security or commodity that is stipulated in a contract. For instance, if a contract requires the delivery of 10,000 shares of a stock, but only 7,000 shares are delivered, this would be termed as a partial delivery.
Partial exemption in VAT refers to limitations imposed by tax legislation on the input tax a taxable person can claim when they make a mix of taxable and exempt supplies.
Partial interest refers to the ownership of a portion of the ownership rights to a parcel of real estate. This can include rights such as mineral rights, easements on another's property, or leasehold rights.
Circumstances that arise if a will covers only part of the estate of the deceased, leading to a mix of estate distribution based on the will and the rules of intestacy.
Detailed exploration of partial liquidation in corporate finance, including examples, FAQs, related terms, resources, and suggested books for further studies.
A provision in a mortgage that allows some of the property pledged to be freed from serving as collateral when certain conditions are met.
Partial taking refers to the acquisition by condemnation of only part of the property or some property rights. It requires just compensation to the property owner for the loss incurred.
Partial-equilibrium analysis is an approach in economic analysis that focuses only on the part of the economy affected by the factors being studied, isolating it from the rest of the economy to better understand impact.
A participated loan, also known as participation financing, is a large loan that exceeds the lending limit of an individual bank and is shared among a group of lenders.
A Participating Insurance Policy is a type of life insurance policy that pays dividends to the policyholder. These dividends are typically a share of the insurer's profits and can be taken in cash, used to reduce premiums, or reinvested back into the policy.
Participating Interest refers to an interest held by an entity in the shares of another entity, maintained on a long-term basis to exercise some measure of control or influence over the activities of the second entity.
An insurance coverage type that allows the insured to receive dividends based on the company's earnings, which can be used to reduce premium payments.
Participating Preference Shares are a type of preference share that not only provides a fixed dividend but also allows holders to participate in additional profits after certain conditions are met.
Participating preferred stock is a type of preferred stock that not only pays a specified dividend but also entitles the holder to participate with common shareholders in additional earnings distributions under certain conditions.
A Participation Certificate is a financial instrument representing a share in a pool of funds or in other assets, such as mortgage pools. It provides investors with a means to invest in collective assets and receive proportional income from those assets.
A participation loan is a financial arrangement where multiple lenders share in providing a loan, typically with one lender acting as the lead to service the loan. This can distribute the risk and allow for larger loan amounts than a single lender might handle.
Participative budgeting is a budgeting process where various levels of management are involved in setting the budget. This method aims to boost ownership and accountability, ensuring that performance benchmarks reflect the input of those who are responsible for meeting them.
Participative leadership, also known as consultative management, encourages team member participation in decision-making, fostering a collaborative and inclusive work environment.
An open form of management where employees have a strong decision-making role. Developed by managers seeking a cooperative relationship with their employees, participative management aims to increase productivity, improve quality, and reduce costs.
Any person who has an interest in the capital or income of a company, such as a shareholder, loan creditor, or any individual entitled to the distributions of the company.
Partition refers to the concept of dividing a whole into multiple segments, which can apply to various fields such as real estate, office management, and computer storage.
A partly paid share is a share for which the shareholder has not yet paid the full par value. This concept was historically used by banks and insurance companies and has seen a revival in large share issues, notably in privatizations.
A partner is a member of a partnership, which could be a syndicate, association, pool, joint venture, or another unincorporated organization. Partners generally report their pro rata share of partnership income and deductions on their personal tax returns.
A Partner's Drawing is the amount withdrawn by a partner from the firm for personal use. These drawings are typically made against the partner’s share of profit or capital in the business.
An association of two or more people (partners) formed for the purpose of carrying on a business. Partnerships vary in legal structure and liability among partners and are specifically governed by laws and agreements.
Partnership accounts refer to the detailed accounting records maintained by a partnership, encompassing various essential documents such as the appropriation account, capital account, and current account. These accounts aid in the equitable distribution of profits and manage the financial dealings among partners in accordance with the partnership agreement.
A Partnership Agreement, also known as Articles of Partnership, outlines the partnership terms, including profit sharing, salaries, interest on capital, and introduction or retirement of partners, governed by the Partnership Act 1890.
Partnership life and health insurance provide critical protection to maintain the value of a business in case of the death or disability of a partner. This insurance facilitates the transfer of a deceased or disabled partner's interest to the surviving partners based on a predetermined formula.
Parts Per Million (PPM) is a unit of measurement used to express the concentration of one substance within a million parts of a given medium, often employed in chemical analysis to determine the concentration of trace substances.
In legal terms, a 'party' refers to an individual or entity that is involved in a legal contract, lawsuit, or other legal proceedings.
A party line is a telephone service available at a lower rate than a private line. It allows multiple users to share the same line, but users are not allowed to interfere with each other.
Pascal is a high-level computer programming language developed by Niklaus Wirth designed to encourage structured programming and data structuring. It has played a significant role in teaching and is noteworthy for its support for structured and modular programming.
A Pass-Through Certificate is an investment instrument that allows investors to receive income that is derived from another entity, often a group of pooled assets such as mortgages. These pooled assets generate receipts or payments that are subsequently passed through to the certificate holders.
A pass-through entity is a non-taxable business structure where income or expenses are passed directly to the owners, retaining their original character.
Pass-through securities represent a financial instrument where income generated from a pool of underlying assets, such as loans or mortgages, is passed on to investors through intermediaries.
Pass-throughs refer to operating expenses that can be charged to a tenant along with the usual rent, as defined in the lease. Additionally, the term also relates to pass-through certificates in the context of mortgage-backed securities.
A passbook is a book issued by a bank to record deposits, withdrawals, and interest earned in a savings account, typically known as a passbook savings account. It lists the depositor's name, account number, and all transactions.
A dividend customarily paid on common shares that the board of directors fails to declare, usually due to financial difficulties at the company; also referred to as an omitted dividend. It differs in implications when associated with cumulative preferred stocks, where the passed dividends accrue until paid.
A unit of measure that is a product of average trip length multiplied by the number of passengers. Statistics for transportation safety are often cited on the basis of passenger miles.
An in-depth look into Passive Activity Loss (PAL), including definition, examples, frequently asked questions, related terms, online resources, and suggested books for further studies.
An investment or activity that generates passive income, typically seen in income-oriented real estate limited partnerships. This income can offset passive activity losses (PALs) for tax purposes.
