Vocabulary

Question 1

Lien

Answer 1

• the right to take possession of collateral until a debt is repaid.

Question 2

. Limited Liability corporation

Answer 2

• A special type of corporation where individual’s owners are taxed on the profits of the company, but the corporation is liable for debt or judgments against the company.

Question 3

Line of Credit

Answer 3

A loan that provides the borrower a maximum amount of money he/she can borrower. The borrower can then access or use that line of credit for only as much money as they need at any particular time.

Question 4

. Liquid Assets

Answer 4

• Cash or securities that can be immediately turned into cash, which can then repay any loan amount outstanding.

Question 5

Louisiana Department of Revenue

Answer 5

The state agency that collects state taxes.

Question 6

Marketing-

Answer 6

How a business communicates to large numbers of customers, motivating them to learn more about the business and its offerings.

Question 7

Maturity

Answer 7

The date is a loan is repaid in full.

Question 8

Mentor

Answer 8

• A person who coaches and supports an entrepreneur or a student studying to become an entrepreneur

Question 9

Mortgage

Answer 9

• The money a person borrows top buy real estate

Question 10

Mutual fund

Answer 10

– An investment security that includes purchase mutual funds because they are less risky than holding any individual stock

Question 11

.Net income

Answer 11

• “net” means revenues after costs

Question 12

. obligation

Answer 12

A payment that is owed every month.

Question 13

Online credit

Answer 13

Debt obtained from a number of online companies. Borrowers need to disclose much less information about themselves to obtain online credit, and online credit companies make credit decisions much more quickly than banks. For these reasons, online credit is much more expensive for borrowers than bank loans,

Question 14

Overdraft

Answer 14

• when a company issues a check or makes a financial commitment for an amount greater than the amount the company has deposited in the bank

Question 15

Overhead

Answer 15

costs that a business incurs that are not part of producing the goods or services its sells, but which are required to operate legally and efficiently.

Question 16

own “free and clear

Answer 16

Owning an asset without any associated debt.

Question 17

partnership

Answer 17

• when two or more individuals own a company. Partners are taxed on the profits of the company, and are personally liable for any debts or judgement against the company

Question 18

Principal-

Answer 18

The amount of money borrowed

Question 19

Pro forma

Answer 19

A Latin phrase that in business means a projection of future financial performance. A pro forma usually takes the form of a projection of future revenues and costs.

Question 20

Problem solving

Answer 20

• The ability to find solutions to difficult or complex issues.

Question 21

profit

Answer 21

• revenues minus costs

Question 22

Profits per unit

Answer 22

Unit price minus cost of goods sold.

Question 23

Quarter

Answer 23

Most projections are for a year. Quarter means 3 months

Question 24

real estates

Answer 24

– Real estate is property and the buildings on it. Real estate can be a piece of land or can be a home on that piece of land, or it can be a building. Real estate is typically using a mortgage.

Question 25

. secured Debt

Answer 25

Debt that includes a legal obligation by the borrower to repay the debt personally if the business is unable to make its scheduled debt payment. A secured debt can be guaranteed by the entrepreneur or by any credit worthy guarantor.