Adv Acct Ch 18

A bank loan agreement that provides immediate short-term access to cash.

• Line of Credit

• Bond

• Notes Payable

• Common Stock

The payment of an operating expense necessary to earn revenue.

• Operating Expense

• non-operating expense

• Revenue Expenditure

• Capital Expenditure

A value assigned to a share of stock.

• Paid-in Excess of Par Value

• Par Value

• Face Value

• Market Value

A class of stock that gives preferred shareholders preference over common shareholders in dividends along with other rights.

• Common Stock

• Market Stock

• Preferred Stock

• Preference Stock

All bonds representing the total amount of a loan.

• Bond Issue

• Paid-in Excess of Bond

• Coupon Issue

• Collateral

Obtaining capital by borrowing money for a period of time.

• Equity Financing

• Debt Financing

• Leverage Financing

• Capital Financing

A long-term promise to pay a specified amount on a specified date and to pay interest at stated intervals.

• Common Stock

• Preferred Stock

• Line of Credit

• Bond

Obtaining capital by issuing additional stock in a corporation.

• Equity Financing

• Debt Financing

The interest rate charged to a bank’s most creditworthy customers.

• Federal Funds Rate

• Discount Rate

• Prime Rate

• Credit Rate

Purchases of plant assets used in the operation of a business.

• Asset Expenditure

• Sunk Cost

• Asset Purchase

• Capital Expenditure