Accounts Payable (AP) - "Accounts payable" (AP) refers to an account within the general ledger that represents your ecommerce company's obligation to pay off a short-term debt to its creditors or suppliers.
Accounts Receivable (AR) - Accounts receivable (AR) is the balance of money due to a firm for goods or services delivered or used but not yet paid for by customers.
Accruals - Accruals are revenues earned or expenses incurred which impact your company's net income on the income statement, although cash related to the transaction has not yet changed hands.
Average Inventory - Average inventory is a calculation that estimates the value or number of a particular good or set of goods during two or more specified time periods.
Breakeven Point (BEP) - The breakeven point (break-even price) for a trade or investment is determined by comparing the market price of an asset to the original cost; the breakeven point is reached when the two prices are equal.
Cash Management - Cash management is the process of collecting and managing cash flows.
Cost of Goods Sold (COGS) - Cost of goods sold (COGS) refers to the direct costs of producing the goods sold by your company.
Financial Health - Financial health is a term used to describe the state of one's personal monetary affairs.
Inventory - The term inventory refers to the raw materials used in production as well as the goods produced that are available for sale. There are three types of inventory, including raw materials, work-in-progress, and finished goods.
Inventory Accounting - Inventory accounting is the body of accounting that deals with valuing and accounting for changes in inventoried assets.
Inventory Financing - The term inventory financing refers to a short-term loan or a revolving line of credit that is acquired by a company so it can purchase products to sell at a later date. These products serve as the collateral for the loan.
Inventory Management - Inventory management refers to the process of ordering, storing, using, and selling a company's inventory. This includes the management of raw materials, components, and finished products, as well as warehousing and processing of such items.
Inventory Turnover - ****Inventory turnover is a financial ratio showing how many times a company has sold and replaced inventory during a given period.
Inventory Write-Off - An inventory write-off is an accounting term for the formal recognition of a portion of a company's inventory that no longer has value.
Liquidity - Liquidity refers to the efficiency or ease with which an asset or security can be converted into ready cash without affecting its market price. The most liquid asset of all is cash itself.
Obsolete Inventory - Obsolete inventory is a term that refers to inventory that is at the end of its product life cycle. This inventory has not been sold or used for a long period of time and is not expected to be sold in the future.
Operating Margin - The operating margin measures how much profit a company makes on a dollar of sales after paying for variable costs of production, such as wages and raw materials, but before paying interest or tax.
Return - A return, also known as a financial return, in its simplest terms, is the money made or lost on an investment over some period of time.
Solvency - Solvency is the ability of a company to meet its long-term debts and financial obligations.
Solvency Ratio - A solvency ratio is a key metric used to measure an enterprise’s ability to meet its long-term debt obligations and is used often by prospective business lenders.
Value-Added Tax (VAT) - Value-added tax (VAT) is a consumption tax on goods and services that is levied at each stage of the supply chain where value is added, from initial production to the point of sale.
Warranty - A warranty is a type of guarantee that a manufacturer or similar party makes regarding the condition of its product.
Working Capital - ****Working capital, also known as net working capital (NWC), is the difference between a company’s current assets — such as cash, accounts receivable/customers’ unpaid bills, and inventories of raw materials and finished goods—and its current liabilities, such as accounts payable and debts.
