Excel Business Statements: Vocabulary

Assets, Liabilities and Net Worth The cash and valued items (including inventory, building and land) that a business has that increases Net Worth. Liabilities: The debts that a business has which decrease net worth Net Worth: The value of a business, Assets-Liabilities = Net Worth

Capital, Equity, Inventory Captial: The cash that a business has, often used in relation to its “start up” money. Equity: The value of all assets and monies due to a company, including current inventory. Inventory: The amount of product that a business has in stock.

Accounts Payable, Accounts Receivable: The bills/invoices that need to be paid by your business. (bills for inventory, supplies, products, etc,) Accounts Receivable: The bills/invoices that you have sent out to clients and other business in order for you to receive payments.

Invoice, Service business The paper or electronic bill that you sent to a company in order to receive payment. Also, the bill that they send you to get their own payments. The accounts receivable and payable dept handles invoicing in large businesses. Service Business A business that seeks to earn its primary income through providing a service to its customers.

Quantity, Payment Terms, Revenue The amount of a product. (the amount in stock, the amount sold, the amount backordered). Payment Terms: The time, amount, and form of payment that is agreed upon between businesses and individuals. Revenue: Money you make as a turnover profit from day to day by selling your products and services.

Operating Expenses, Net Profit, Depreciation The amount of money it costs you to do business. (including rent, supplies, inventory, salary, etc.) Net Profit: The amount of money your company earns from its sale of a service or product after operating expenses are removed. Depreciation: The amount in which the value of an item decreases. This can be the building, old products, your machinery.

Vendor, Units on Hand, Average Unit Cost : The place selling an item. It could be you, or it could be the place you bought your inventory from. Units on Hand: The amount of product you have in your store, right now. Average Unit Cost: The amount of money the average unit SOLD for within a given time.