FBLA Terms

🔑 CORE FINANCIAL STATEMENT TERMS

Income Statement
Shows a company’s revenues, expenses, and profitability over a period of time.

Revenue (Sales)
Total income earned from selling goods or services before expenses.

Cost of Sales (COGS)
Direct costs required to produce goods sold, including food, beverage, and packaging.

Operating Expenses
Costs to run the business that are not directly tied to production, such as labor, rent, utilities, and marketing.

Operating Income
Profit earned from core operations before interest and taxes.

Operating Margin
Operating income ÷ revenue; measures operating efficiency and profitability.

Net Income (Net Earnings)
Profit remaining after all expenses, interest, and taxes.

Net Profit Margin
Net income ÷ revenue; shows how much profit is generated per dollar of sales.

Earnings Per Share (EPS)
Net income ÷ shares outstanding; measures profit allocated to each share.

📊 BALANCE SHEET & FINANCIAL POSITION

Balance Sheet
Shows assets, liabilities, and shareholders’ equity at a specific point in time.

Assets
Resources owned by a company that provide future economic value.

Total Assets
The sum of all current and long-term assets.

Current Assets
Assets expected to be converted into cash within one year.

Inventory
Goods held for sale; for Chipotle, kept low due to the fresh-food model.

Cash and Restricted Cash
Cash available for operations and cash set aside for specific purposes.

Liabilities
Obligations the company owes to others.

Current Liabilities
Obligations due within one year.

Long-Term Debt
Borrowed money due after one year.

Operating Lease Obligations
Long-term rental commitments for restaurant locations.

💧 LIQUIDITY & SOLVENCY TERMS

Liquidity
The ability to meet short-term financial obligations.

Current Ratio
Current assets ÷ current liabilities; measures short-term liquidity.

Working Capital
Current assets minus current liabilities.

Solvency
Ability to meet long-term obligations and remain financially stable.

Capital Structure
The mix of debt and equity used to finance the business.

Conservative Capital Structure
Reliance on internal cash rather than heavy borrowing.

Financial Risk
Risk related to debt levels and the ability to meet obligations.

💸 CASH FLOW TERMS

Cash Flow Statement
Shows actual cash inflows and outflows from operations, investing, and financing.

Operating Cash Flow (OCF)
Cash generated from core business operations.

Investing Cash Flow
Cash used for or generated by investments like new restaurants or equipment.

Financing Cash Flow
Cash related to share repurchases, debt, or equity transactions.

Cash-Backed Earnings
Earnings supported by real cash, not just accounting profits.

📈 GROWTH, EFFICIENCY & PERFORMANCE

Comparable Restaurant Sales (Same-Store Sales)
Sales growth from locations open at least one year; measures organic growth.

Organic Growth
Growth from existing operations, not expansion.

Revenue Growth Rate
Percentage increase in revenue year over year.

Efficiency
How well the company converts revenue into profit and cash.

Operational Efficiency
Effectiveness in managing costs and operations.

Operational Leverage
Ability to grow profits faster than revenue.

🏭 INDUSTRY & COMPARISON TERMS

Fast-Casual Industry
Restaurant segment between fast food and casual dining.

Benchmark
Industry standard used for comparison.

Industry Average
Average performance across competitors.

Margin Compression
Decline in profit margins due to rising costs.

Competitive Positioning
How a company performs relative to competitors.

Restaurant-Level Margin
Profitability at the individual restaurant level.

🧠 STRATEGY & SHAREHOLDER TERMS

Shareholders’ Equity
Residual value after liabilities; reflects retained earnings and capital returns.

Retained Earnings
Cumulative profits kept in the business.

Share Repurchases (Stock Buybacks)
Company buys back its own shares, reducing shares outstanding.

Capital Allocation
How cash is used: reinvestment, debt reduction, or shareholder returns.

Pricing Power
Ability to raise prices without losing demand.

Brand Elasticity
Customer willingness to absorb price increases.

🧾 REGULATORY & DATA TERMS

SEC Filings
Required financial reports filed with the U.S. Securities and Exchange Commission.

Form 10-K
Annual, audited financial report used as your primary data source.

SEC-Reported Data
Official, audited financial information.

🧠 ADVANCED / JUDGE-IMPRESSING TERMS

Earnings Quality
How sustainable and cash-backed earnings are.

Financial Flexibility
Ability to respond to economic changes without stress.

Risk Mitigation
Actions taken to reduce financial risk.

Execution Risk
Risk from rapid expansion or operational complexity.

Sustainable Growth
Growth that can be maintained long-term without harming finances.