Financial Management with Short-term Debt

A comprehensive set of vocabulary flashcards covering fundamental concepts related to financial management and short-term debt.

Operating Cash Flow

The cash generated from ongoing business operations from purchases and sales of goods or services.

Liquidity Budget

A plan that outlines expected cash inflows and outflows to manage liquidity effectively.

Net Working Capital

The difference between current assets and current liabilities, used to measure a company's short-term financial health.

Debtors Policy

A strategy to manage accounts receivable and influence the collection of payments from customers.

Inventory Optimization

The process of managing inventory levels to meet demand while minimizing costs.

Cash Credit

A short-term loan agreement allowing a company to withdraw more funds than are available in its bank account.

Straight Loan

A loan where interest is paid periodically and the principal is repaid in full at the end of the term.

Factoring

A financial transaction where a business sells its receivables to a third party for immediate cash.

Documentary Credit

A financial guarantee from a bank to a seller on behalf of a buyer, ensuring payment upon meeting specified conditions.

Commitment Credit

A type of credit in which a lender guarantees payment to a third party if the borrower defaults.

Tax Prepayment Credit

An arrangement allowing taxpayers to defer tax payments to improve cash flow.

Vacation Pay Credit

A specific type of credit to help businesses manage the cash flow impact of vacation pay and year-end bonuses.