| A | B |
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| financial planning | the task of determining how a business will afford to achieve its strategic goals and objectives |
| startup budget | used by a new business or during expansion of a business until profits are made |
| operating budget | used for ongoing business operations for a specific period |
| cash budget | used to estimate cash flow in and out of a business |
| asset records | represent ownership of value that can be converted into cash (although cash itself is also considered an asset) |
| depreciation records | non-cash expense that reduces the value of an asset over time. Assets depreciate for two reasons: wear and tear and obsolescence |
| inventory records | usually the largest current asset of a business, and proper measurement of them is necessary to assure accurate financial statements |
| cash records | helps in keeping track of the money that is coming inside the company and all the money that is being spent |
| payroll records | A printed form on which detailed records are kept of the amounts of money paid to auxiliaries |
| tax records | tax returns and the information that supports the information in the returns |
| financial statement | is a formal record of the financial activities of a business, person, or other entity |
| balance sheet | which represents a single moment in time |
| income statement | represents a period of time |
| current ratio | Equals current assets/current liabilities |
| debt to equity ratio | Equals total liabilities/owner’s equity |
| return on equity ratio | Equals net profit/owner’s equity |
| net income ratio | Equals total sales/net income |
