Claire Mary Ann U. Araque Prof. Noel P.

Bermudez
ABM 11-29

ASSIGNMENT

BUSINESS MATH
1. Checkbook
A folder or small book containing preprinted paper instruments issued to checking account holders
and used to pay for goods or services. A checkbook contains sequentially numbered checks that
account holders can use as a bill of exchange. The checks are usually preprinted with the account
holder's name, address and other identifying information. In addition, each check will also include the
bank's routing number, the account number and the check number.

2. Bank Statement
A bank statement is a record, typically sent to the account holder every month, summarizing all the
transactions in an account throughout the time from the previous statement to the current statement.
The opening balance from the previous month added to the total of all transactions during the period
results in the closing balance for the current statement. Consumers should carefully review their bank
statements and keep them for their own financial records.

3. Service Charge
A service charge is a type of fee charged to cover services related to the primary product or service
being purchased. For example, a concert venue may charge a service fee in addition to the initial price
of a ticket in order to cover the cost of security or for allowing electronic purchases. Another example
would be a fee for using the ATM of a competing bank.

4. Check
A check is a written, dated and signed instrument that contains an unconditional order from the
drawer that directs a bank to pay a definite sum of money to a payee. The money is
drawn from a banking account, also known as a checking account.

5. Outstanding Check
An outstanding check is a financial instrument that draws on the funds in an individual's or business'
bank account but which has not yet been cashed or deposited by the payee. An outstanding check
represents a liability for the payer. The payer must be sure to keep enough money in the account to
cover the amount of the outstanding check until it is cashed, which could take weeks or even months.

6. Cancelled Check
A canceled check is a check that has cleared the depositor's account and has been marked "canceled"
by the bank. A canceled check has been paid by the drawee bank and endorsed by the payee, the
payee's bank and the Federal Reserve Bank. Canceled checks can also be used as proof of payment.

7. No Sufficient Fund Check

It is also called NSF check. It is a check that cannot be honored by a bank due to insufficient funds
in the account of the check drawer. A non-sufficient-funds check amount is an item on a bank statement
but not on the books. A non-sufficient-funds check amount should be deducted from the book balance
in preparing a bank reconciliation.
8. Reconciling the Bank Balance
The financial accounting term reconciliation of bank account balances refers to the process of
understanding the difference between the company's records of cash in their account, and the amount
appearing on a statement received from the bank.

9. Deposit in Transit
A deposit in transit is money that has been received by a company and sent to the bank, but which
has not yet been processed and posted to the account by the bank. In financial accounting, these
deposits are reflected in the company's cash balance on the day the deposit is received, even though
it may take the bank several days to process the deposit and post it to the balance.

10. Salary
A salary is a form of periodic payment from an employer to an employee, which may be specified in
an employment contract. It is contrasted with piece wages, where each job, hour or other unit is paid
separately, rather than on a periodic basis. From the point of view of running a business, salary can
also be viewed as the cost of acquiring and retaining human resources for running operations, and is
then termed personnel expense or salary expense. In accounting, salaries are recorded in payroll
accounts.

11. Wage
Wage means payment for units of time or units of product as valued under a wage rate agreement.
Today's most common unit is the hour. Many governments impose minimum wage rates upon
employers to protect society. However, many employers offer employees significantly higher wage
rates.

12. Overtime
Overtime is the amount of time someone works beyond normal working hours. The term is also used
for the pay received for this time. Normal hours may be determined in several ways:
by custom (what is considered healthy or reasonable by society),
by practices of a given trade or profession,
by legislation,
by agreement between employers and workers or their representatives.

13. Mark On
Markup is the ratio between the cost of a good or service and its selling price. It is expressed as a
percentage over the cost. A markup is added onto the total cost incurred by the producer of a good or
service in order to cover the costs of doing business and create a profit. The total cost reflects the total
amount of both fixed and variable expenses to produce and distribute a product. Markup can be
expressed as a fixed amount or as a percentage of the total cost or selling price. Retail markup is
commonly calculated as the difference between wholesale price and retail price, as a percentage of
wholesale. Other methods are also used.

14. Mark Down

The difference between the highest current bid price among dealers in the market for a security and
the lower price that a dealer charges a customer. Dealers will sometimes offer lower prices in order to
stimulate trading; the idea is to make the money back in extra commissions.
15. Gross Margins
Gross margin is a company's total sales revenue minus its cost of goods sold (COGS), divided by
total sales revenue, expressed as a percentage. The gross margin represents the percent of total sales
revenue that the company retains after incurring the direct costs associated with producing the goods
and services it sells. The higher the percentage, the more the company retains on each dollar of sales,
to service its other costs and debt obligations.

16. Single Trade Discounts

A single trade discount is a discount that is given to a customer (usually a wholesaler) when the
customer buys a product. The discount is expressed simply as a single discount of a given
percentage. For example, a 25% discount on the purchase.

17. Loss
General: Unrecoverable and usually unanticipated and non-recurring removal of, or decrease in, an
asset or resource.
Accounting: (1) cost that produces no benefit, (2) decrease in value, (3) excess of expenditure over
income, (4) excess of cost over the net proceeds from a transaction.
Insurance: (1) reduction in the value of an insured property due to an insured peril, (2) amount sought
in an insurance claim, or (3) amount paid under an insurance contract.

18. Break Even

Breakeven means to experience neither gain nor loss, neither benefit nor detriment. "During the year
my portfolio was substantially down, but due to some gains near the end of the year it was able to reach
breakeven."

19. Break Even Point

The breakeven point is the price level at which the market price of a security is equal to the original
cost. For options trading, the breakeven point is the market price that a stock must reach for an option
buyer to avoid a loss if they exercise the option. For a call buyer, the breakeven point is the strike
price plus the premium paid, while breakeven for a put position is the strike price minus the premium
paid.

20. Mortgage
A mortgage is a debt instrument, secured by the collateral of specified real estate property, which
the borrower is obliged to pay back with a predetermined set of payments. Mortgages are used by
individuals and businesses to make large real estate purchases without paying the entire value of the
purchase up front. Over a period of many years, the borrower repays the loan, plus interest, until he/she
eventually owns the property free and clear. Mortgages are also known as "liens against property" or
"claims on property." If the borrower stops paying the mortgage, the bank can foreclose.

21. Amortization
Amortization is the paying off of debt with a fixed repayment schedule in regular installments over a
period of time for example with a mortgage or a car loan. It also refers to the spreading out of capital
expenses for intangible assets over a specific duration (usually over the asset's useful life) for
accounting and tax purposes.
22. Loans
A loan is the act of giving money, property or other material goods to another party in exchange for
future repayment of the principal amount along with interest or other finance charges. A loan may be
for a specific, one-time amount or can be available as an open-ended line of credit up to a specified
limit or ceiling amount. Loans can come from individuals, corporations, financial institutions, and
governments. They offer a way to grow the overall money supply in an economy as well as open up
competition and expand business operations. The interest and fees from loans are a primary source of
revenue for many financial institutions such as banks, as well as some retailers through the use of credit
facilities.

23. Commissions
A commission is a service charge assessed by a broker or investment advisor in return for
providing investment advice and/or handling the purchase or sale of a security. Most major, full-service
brokerages derive most of their profits from charging commissions on client transactions. Commissions
vary widely from brokerage to brokerage.

24. Cash Basis

Cash basis refers to a major accounting method that recognizes revenues and expenses at the time
physical cash is actually received or paid out. This contrasts to the other major accounting
method, accrual accounting, which recognizes income in a company's books at the time the revenue is
earned, but not necessarily received, and records expenses when liabilities are incurred, but not
necessarily paid.

25. Installment Basis

Installment Sale: A method of sale that allows for partial deferral of any capital gain to
future taxation years. Installment sales require the buyer to make regular payments, or installments, on
an annual basis, plus interest if installment payments are to be made in subsequent taxation years.
Installment Payment: One of a series of regular payments of a loan, debt, etc., or the system of
making regular payments:
Installment: 1. Any of several parts into which a debt or other sum payable is divided for payment at
successive fixed times: to pay for furniture in monthly installments.
2. A single portion of something furnished or issued by parts at successive times:
Installment Loan: An installment loan is a type of loan that is repaid in periodic installments (usually
monthly payments) that include principal and interest.
Installment Debt: An installment debt is a loan that is repaid by the borrower in regular installments.
Installment debt is generally repaid in equal monthly payments that include interest and a portion of
principal. It is a favored method of consumer financing for big-ticket items such as cars and appliances.
The arrangement benefits all parties. The consumer benefits from financing expensive items at interest
rates that are typically far lower than credit card interest rates. The dealer or seller gains through
increased sales volumes, while the lender benefits by charging higher rates on installment debt than
can be charged on other loans.

26. Down Payment

A down payment is a type of payment made in cash during the onset of the purchase of an expensive
good or service. The payment typically represents only a percentage of the full purchase price; in some
cases, it is not refundable if the deal falls through. In most cases, the purchaser makes financing
arrangements to the cover the remaining amount owed to the seller.