Financial Management Flashcards Preview

RD Exam > Financial Management > Flashcards

Flashcards in Financial Management Deck (33)
Loading flashcards...
1

Revenue budget

estimated sales; projected during the budget process

2

Operational budget

guides day-to-day ops; foundation of planning and control; include revenue and costs

3

Capital budget

foundation for growth, repairs

4

Cash flow budget

estimated flow of cash in and out during a given time period

5

Master budget

operational, capital, revenue, cash flow budgets; estimated profit provided as well

6

Incremental budget

based on previous year's budget adjusted for inflation

7

Performance budget

preference is given to those projections for generations of sales

8

Zero-based budget

made each year; funds allocated by justification to continue activities or beginning new activities

9

Revenue

money received for the sale of a good

10

Direct costs/expense

costs associated with a specific department, product, service

11

Indirect costs/expense

costs that CANNOT be associated with a specific department, product, service

12

Capital expenditures

Major purchases/replacements, improvements, expansions

13

Profit margin

revenue less all costs of a specified good or service

Profit margin on sales = net income/sales

14

ROI

The amount received in excess of the original investment. Usually expressed as a % on an annual/yearly basis. Possible to have a negative ROI. May be expressed as interest, gain/loss, net income/loss. The original amount invested may also be referred to as an asset, investment, capital, or principal.

15

Financial Statements

aid to determine financial condition and profitability

16

Balance sheet

statement of assists, liabilities, and equity

17

Income statement

revenue and income less expenses for the period arriving at net income or loss

18

Cost benefit studies

evaluate whether different options would return better results financially or operationally

19

Cost effectiveness

cost vs. results. Desired outcome often not measured in dollars. Assists in determining a specific predetermined goal. Popular in public programs.

20

Cost benefit analysis

effort, time, expense vs. benefits. Performance measured in monetary terms.

21

Productivity studies

evaluated quantitatively; based on input vs output

22

Net income

Revenue - Expenses

23

Revenue

Amounts received from customers for goods or services rendered.

24

Total revenue

Price x quantity sold

25

Expenses

the amounts incurred for producing revenue

26

Goods available for sale

beginning inventory + purchases

27

cost of goods sold

beginning inventory + Purchases - ending inventory

28

Gross profit

sales revenue - cost of goods sold

29

Prime cost

raw material + Labor

30

Fixed cost

Constant regardless of level of production