Basic Business Terms

Question 1

Accounts Payable

Answer 1

Outstanding business obligations owed to others.

Question 2

Accounts Receivable

Answer 2

Outstanding obligations owed to business by others

Question 3

Accounting

Answer 3

A system that provides quantitative finance information.

Question 4

Assets

Answer 4

Value of everything a company owns and uses to conduct business

Question 5

Business

Answer 5

Organization that operates with intention of making profit

Question 6

Business Plan

Answer 6

Ability to create business goals, how they are to be attained and plan to achieve them.

Question 7

Business to Business (B2B)

Answer 7

One business sells goods/services to another business

Question 8

Business to Consumer (B2C)

Answer 8

A business sells goods/services directly to the end user/consumer

Question 9

Cash Flow Statement

Answer 9

Picture of all cash inflows and outflows within the business

Question 10

Company

Answer 10

Considered a business that has employees

Question 11

Contract

Answer 11

Formal agreement to do work for pay.

Question 12

Delivery

Answer 12

When product is delivered to customer completely finished.

Question 13

Depreciation

Answer 13

Degrading value of an asset over time

Question 14

E-Commerce

Answer 14

Buying/selling over the internet

Question 15

Employee

Answer 15

A person working for a company

Question 16

Entrepreneur

Answer 16

Someone who organizes, manages and takes on risk of starting a new business.

Question 17

Expense

Answer 17

Money spent on supplies, equipment or other investments.

Question 18

Finance

Answer 18

Management and allocation of money and other assets

Question 19

Fixed Cost

Answer 19

One-time expense that DOES NOT vary with business volume.

Question 20

Gross Profit

Answer 20

Percentage of business income before expenses.

Question 21

Industry

Answer 21

A category of like/similar businesses.

Question 22

Just In Time (JIT)

Answer 22

Strategy to improve business return on investment (ROI) by creating new plan to obtain better return and reduce inventory and cost.

Also by eliminating or improving areas of poor performance.

Question 23

Liabilites

Answer 23

Value of what a business owes to someone else

Question 24

Management (verb)

Answer 24

Act of organizing and conducting a business to accomplish goals and objectives.

Question 25

Marketing

Answer 25

Process of promoting, selling and distributing a product or service.

Question 26

Net Income/ Profit

Answer 26

Revenues minus expenses

Question 27

Net Worth

Answer 27

Total value of a business

Question 28

Payback Period

Answer 28

Amount of time it takes to recover the initial investment of a business.

Question 29

Payroll Taxes

Answer 29

Monies required by law to be withheld from an employee paycheck each pay period. Includes Social Security, Medicare, federal income tax, state unemployment tax and state income tax.

Question 30

Product/Good

Answer 30

Something produced or manufactured to be sold

Question 31

Profit Margin

Answer 31

Ratio of profit divided by revenue displayed as a percentage.

Question 32

Quality Assurance

Answer 32

Management of materials and services quality for keeping high standard of performance (Ex: Acquiring proper data collection from patients, including history and insurance information)

Question 33

Return On Investment (ROI)

Answer 33

Measurement of project success (the percent of profit earned on an investment).

Question 34

Revenue

Answer 34

Entire amount of income before expenses are subtracted

Question 35

Sales Prospect

Answer 35

Potential customer

Question 36

Service

Answer 36

Work done for pay that benefits another.

Question 37

Supplier/ Vendor

Answer 37

Person or company that provides goods/services needed to do a job

Question 38

Target Market

Answer 38

Specific group of customers at which a company aims its products/services

Question 39

Variable Cost

Answer 39

Expenses THAT CHANGE in proportion to the activity of a business