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Payroll
A list of a business’s employees and how they are compensated.
Payroll Register
Includes a description of employee earnings, tax deductions, benefits received, and payment type.
Balance Sheet
A financial statement that details assets, liabilities, and owner’s equity at a specific moment in time.
Assets = Liabilities + Owner’s Equity
The balance sheet equation used to assess financial stability.
Working Capital
The amount of money a business has for immediate use, calculated as current assets minus current liabilities.
Current Ratio
A financial ratio indicating the relationship between current assets and current liabilities.
Debt Ratio
Shows the relationship between a business’s total assets and total liabilities.
Income Statement
A financial tool that evaluates a business’s financial performance by detailing revenue and expenses.
Net Profit Ratio
Indicates how much a business earns in profit per dollar of sales.
Operating Ratio
Demonstrates the relationship of a company’s operating expenses to its net sales.
Start-Up Budget
A financial statement outlining all equipment, supplies, and marketing expenses required to start a business.
Profit
The financial gain calculated by the difference between the amount earned and the amount spent by a business.
