of the Financial Accounting Standards Board that details the conditions
and procedures for capitalizing leases.
value of an annuity over n periods.
at which investors are indifferent between buying or selling a security.
that is used to hedge against fluctuating interest rates, stock prices,
and exchange rates.
financial firms that facilitate the transfer of funds from savers to
demanders of capital.
that does not provide for maintenance services, is not cancelable, and
is fully amortized over its life; also called a capital lease.
of debt financing.
to which fixed-income securities (debt and preferred stock) are used
in a firm's capital structure.
in which the firms involved will not be operated as a single unit and
from which no operating economies are expected.
in stockholders' risk, over and above the firm's basic business risk,
resulting from the use of financial leverage.
which offers a wide range of financial services, including investment
banking, brokerage operations, insurance, and commercial banking.
Assets Turnover Ratio
of sales to net fixed assets.
Charge Coverage Ratio
extends the TIE ratio to include the firm's annual long-term lease and
sinking fund obligations.
Exchange Rate System
monetary system in existence after World War II until 1971, under which
the value of the U.S. dollar was tied to gold, and the values of the
other currencies were pegged to the U.S. dollar.
under which exchange rates are not fixed by government policy but are
allowed to float up or down in accordance with supply and demand.
whose interest rate fluctuates with shifts in the general level of interest
cost of issuing new common stock.
sold by a foreign borrower but denominated in the currency of the country
in which it is sold.
issued by either foreign governments or foreign corporations.
of an option calculated at the current stock price minus the strike,
or exercise, price.
under which one party agrees to buy a commodity at a specific price
on a specific future date and the other party agrees to make the sale.
Physical delivery occurs.
price at which two currencies will be exchanged at some future date.
owned by the firms' founders that has sole voting rights but restricted
dividends for a specified number of years.
operating cash flows less mandatory equity investments.
received during the discount period.
whose terms are approved by the managements of both companies.
to which a cash flow or series of cash flows will grow over a given
period of time when compounded at a given interest rate.
Value Interest Factor for an Annuity (FVIFAi,n)
value interest factor for an annuity of n periods compounded at i percent.
Value Interest Factor for i and n (FVIFi,n)
value of $1 left on deposit for n periods at a rate of i percent per
contracts that are traded on exchanges and are "marked to market" daily,
but where physical delivery of the underlying asset is virtually never
Copyright © South-Western. All Rights Reserved.