Cash Budget

What is a Cash Budget? Definition: A cash budget is a projection of a company’s future cash inflows and outflows. It is usually prepared on a yearly basis and provides details of expected cash receipts and disbursements. The yearly cash budget is divided into monthly or quarterly time periods so that...

Cash Receipt

What is a Cash Receipt? Definition: When a customer pays a business in cash or by check, it is referred to as a cash receipt. Even payments made by debit/credit card or by wire transfer are referred to as cash receipts. The definition of “cash receipt” even extends to the receipt...

Centralized Government

What is a Centralized Government? Definition: A centralized form of government is one in which all power is held by a single authority or by a group of people. Regional or local leaders are appointed by the central authority and they can usually be removed if they do not abide by...

Change in Demand

What is a Change in Demand? Definition: A change in demand is an increase or a decrease in demand that is not caused by a variation in price. The change could be a result of shifting consumer preferences, a variation in income levels, or a change in the price of a...

Chief Financial Officer (CFO)

What is a Chief Financial Officer (CFO)? Definition: The term Chief Financial Officer is often referred to by its initialism, CFO. The CFO of a company is its senior-most financial officer. This person is responsible for managing the company’s finances and for interacting with external agencies regarding the company’s business results...

Circular Flow Model

What is a Circular Flow Model? Definition: A circular flow model illustrates the movement of goods and services in an economy. Consumers, which are referred to as households, supply the factors of production to producers, which are called firms. The firms manufacture goods and services, which in turn, are sold to...

Cluster Sampling

What is Cluster Sampling? Definition: Cluster sampling is a statistical technique that breaks down the population to be surveyed into segments or clusters. Subsequently, a limited number of clusters are surveyed. If the population is large, random samples may be identified from the selected clusters. Alternately, the entire population in the...

Contractionary Monetary Policy

What is a Contractionary Monetary Policy? Definition: If inflation increases, a country’s central bank can use a contractionary monetary policy to cool the economy and bring down prices. In the U.S., the Federal Reserve can implement a contractionary monetary policy by increasing the “Federal Funds Rate,” which is the rate at...

Contributed Capital

What is Contributed Capital? Definition: Contributed capital is the sum that shareholders have paid to acquire equity in a company. This consists of the par value of the shares and the amount in excess of this value, which is recorded as additional paid-in capital. The total of these two sums is...