Financial Statements & Accounting Financial Terms & Definitions

29 terms in this topic

Financial statements and accounting is a core topic in finance that involves preparing and analyzing records of a company’s economic activities. It includes key reports such as the balance sheet, income statement, and cash flow statement, which are governed by accounting standards like GAAP or IFRS.

D

Depreciation

Depreciation is a fundamental accounting concept that allocates the cost of a tangible asset over its useful life. Instead of…

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E

EBIT

EBIT, an acronym for Earnings Before Interest and Taxes, is a key profitability metric that measures a company’s operating performance…

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E

EBITDA

EBITDA is an acronym that stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It is a widely used financial…

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E

Equity

Equity, also known as shareholder’s equity or owner’s equity, represents the residual interest in the assets of an entity after…

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G

GAAP

GAAP (Generally Accepted Accounting Principles) is a common set of accounting rules, standards, and procedures that companies in the United…

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G

Goodwill

Goodwill is an intangible asset that arises when one company purchases another company for a price greater than the fair…

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G

Gross profit

Gross profit is the profit a company makes after deducting the costs directly tied to producing and selling its products…

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L

Liabilities

Liabilities are financial obligations or debts that a company or individual owes to others. They represent claims against the assets…

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Cost of goods sold (COGS) Cost of Goods Sold (COGS) is a key financial metric that represents the direct costs attributable to the… Current assets Current assets are a category of assets on a company’s balance sheet that are expected to be converted… Current liabilities Current liabilities are a company’s short-term financial obligations that are due within one year (or within the business’s… Depreciation Depreciation is a fundamental accounting concept that allocates the cost of a tangible asset over its useful life.… EBIT EBIT, an acronym for Earnings Before Interest and Taxes, is a key profitability metric that measures a company’s… EBITDA EBITDA is an acronym that stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It is a widely… Equity Equity, also known as shareholder’s equity or owner’s equity, represents the residual interest in the assets of an… GAAP GAAP (Generally Accepted Accounting Principles) is a common set of accounting rules, standards, and procedures that companies in… Goodwill Goodwill is an intangible asset that arises when one company purchases another company for a price greater than… Gross profit Gross profit is the profit a company makes after deducting the costs directly tied to producing and selling… Income statement An income statement is one of the three core financial statements used by businesses, investors, and analysts to… Liabilities Liabilities are financial obligations or debts that a company or individual owes to others. They represent claims against…