In finance and accounting, 'capital' refers to various forms of assets, interests, or financial contributions that play a critical role in the functioning of an entity or the production process, enhancing productivity and enabling operations.
A credit balance is an accounting term that refers to the situation where the total of credit entries in an account exceeds the total of debit entries. These balances typically represent revenue, liabilities, or capital.
Econometrics involves using computer analysis and statistical modeling techniques to mathematically describe numerical relationships between key economic forces such as labor, capital, interest rates, and government policies, and test the effects of changes in economic scenarios.
Factors are critical economic resources and agents involved in the production and distribution of goods and services, encompassing capital, human resources, property resources, entrepreneurial ability, and intermediaries.
Factors of production refer to the resources required to produce economic goods, including land, labor, capital, and entrepreneurial ability. Each factor has an associated cost: rent for land, wages for labor, interest for capital, and profit for the entrepreneur.
Finance involves the practice of managing and manipulating money, the capital involved in a project, and obtaining loans for specific purposes.
A financial market is a marketplace where the trading of financial instruments such as stocks, bonds, commodities, and currencies occurs. These markets facilitate the exchange of capital and credit in the economy.
Growth accounting is a method used in economics to determine the contribution of different factors (such as labor, capital, and technology) to economic growth.
The presentation of a financial statement in which the debits are given on one side of the statement and the credits on the other. In the case of a balance sheet, the fixed assets and current assets would be shown on the left-hand side of the statement, and the capital and liabilities on the right-hand side.
The Initial Public Offering (IPO) is the first sale of shares by a private company to the public. IPOs are critical as they help companies raise capital and expand their operations, but setting the issue price correctly can be a challenging task.
An economic measure that represents the sum total of the value of all capital and goods held within a nation. It encompasses the net value of all assets owned by residents and businesses of a country at a particular time.
In accounting, a reserve refers to a part of a company's capital, other than its share capital. This capital can largely arise from retained profits or from the issuance of share capital at more than its nominal value. Reserves differ from provisions as they represent undistributed surpluses, with some being non-distributable. Directors may earmark these funds for specific purposes.
Undercapitalization refers to the state of a company that lacks sufficient capital or reserves for its operational needs, often due to rapid growth. This situation can result in a profitable company struggling to convert earnings into cash to pay its debts.
Value Added refers to the value of a product or output minus the costs of raw materials used in production. Essentially, it represents the increase in value created by the manufacturing process through the application of capital and labor.
