Wall Street is a street in lower Manhattan that is the original home of the New York Stock Exchange and the historic headquarters of the largest U.S. brokerages and investment banks. The term Wall Street is also used as a collective name for the financial and investment community.
Following are the list of Financial words which are highly texted among the people of wallstreet and around lower Manhattan.
1.ASSET :
Assets which are obvious and will be reported on a company's balance sheet include: cash, accounts receivable, inventory, investments, land, buildings, and equipment. In addition, a company's balance sheet will also report prepaid expenses as an asset.
2.CASH :
The term cash and cash equivalents includes: currency, coins, checks received but not yet deposited, checking accounts, petty cash, savings accounts, money market accounts, and short-term, highly liquid investments.
3.ACCOUNTS RECEIVABLE :
Accounts receivable is a legally enforceable claim for payment held by a business for goods supplied and/or services rendered that customers/clients have ordered but not paid for. These are generally in the form of invoices raised by a business and delivered to the customer for payment within an agreed time frame.
4.INVENTORY :
The cost of the merchandise purchased but not yet sold is reported in the account Inventory or Merchandise Inventory. Inventory is reported as a current asset on the company's balance sheet. Inventory is a significant asset that needs to be monitored closely.
5.BALANCE SHEET :
A statement of the assets, liabilities, and capital of a business or other organization at a particular point in time, detailing the balance of income and expenditure over the preceding period.
6.LIQUIDITY :
liquidity (or accounting liquidity) is a measure of the ability of a debtor to pay their debts as and when they fall due. It is usually expressed as a ratio or a percentage of current liabilities. Liquidity is the ability to pay short-term obligations.
7.LIABILITY :
A liability is an obligation and it is reported on a company's balance sheet. A common example of a liability is accounts payable. Accounts payable arise when a company purchases goods or services on credit from a supplier. When the company pays the supplier, the company's accounts payable is reduced.
8.EQUITY :
In financial accounting, owner's equity consists of the net assets of an entity. Net assets is the difference between the total assets and total liabilities. Equity appears on the balance sheet (also known as the statement of financial position), one of the four primary financial statements.
9.INTEREST EXPENSE :
Interest expense is an income statement account which is used to report the amount of interest incurred on debt during a period of time.
10.INTEREST PAYABLE :
Interest payable is a current liability account that is used to report the amount of interest that has been incurred but has not yet been paid as of the date of the balance sheet.
11.DIVIDEND :
A sum of money paid regularly (typically annually) by a company to its shareholders out of its profits (or reserves).
12.SHARE :
Shares are units of ownership interest in a corporation or financial asset that provide for an equal distribution in any profits, if any are declared, in the form of dividends.
13: P/E RATIO :
The price-earnings ratio (P/E ratio) is the ratio for valuing a company that measures its current share price relative to its per-share earnings. The price-earnings ratio is also sometimes known as the price multiple or the earnings multiple.
14.RETURN ON EQUITY (ROE) :
One of the most important profitability metrics is a return on equity, or ROE for short. Return on equity reveals how much after-tax profit a company earned in comparison to the total amount of shareholder equity found on the balance sheet.
15.FREE CASH FLOW (FCF) :
Free cash flow (FCF) is a measure of a company's financial performance, calculated as operating cash flow minus capital expenditures. FCF represents the cash that a company is able to generate after spending the money required to maintain or expand its asset base.
16.CASH FLOW STATEMENT :
In financial accounting, a cash flow statement, also known as statement of cash flows, is a financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down to operating, investing and financing activities.
17.INCOME STATEMENT :
An income statement is a financial statement that reports a company's financial performance over a specific accounting period. Financial performance is assessed by giving a summary of how the business incurs its revenues and expenses through both operating and non-operating activities.
18.PRESENT VALUE :
Present value (PV) is the current worth of a future sum of money or stream of cash flows given a specified rate of return. Future cash flows are discounted at the discount rate, and the higher the discount rate, the lower the present value of the future cash flows.
19.ENTERPRISE VALUE :
Enterprise value (EV), total enterprise value (TEV), or firm value (FV) is an economic measure reflecting the market value of a business. It is a sum of claims by all claimants: creditors (secured and unsecured) and shareholders (preferred and common).
20.AMORTIZATION :
Amortization is an accounting term that refers to the process of allocating the cost of an intangible asset over a period of time. It also refers to the repayment of loan principal over time.
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