Unlocking the intricate world of accounting often means navigating a sea of
specialized terms and jargon. In this blog post, we’re diving into the alphabet soup of
accounting terms that start with P, Q, and R. From “Profit” to “Revenue,” we’ll
demystify these financial terms to help you gain a clearer understanding of the
financial intricacies that drive businesses forward. Whether you’re a budding
entrepreneur or a seasoned financial pro, this guide will be a valuable resource in
your financial toolkit.
Profit
Is the amount of money a business makes after deducting expenses from revenue. It
is an important metric for measuring a company’s financial health.
Payroll
This is the total amount of money that a company pays to its employees for a set
period of time. It includes salaries, wages, bonuses, and deductions for taxes and
benefits.
Quick ratio
Refers to the measure of a company’s liquidity. It is calculated by dividing the sum of
cash, accounts receivable, and short-term investments by current liabilities
Quantity discount
A pricing strategy that offers customers a lower price per unit when they purchase a
larger quantity of goods or services.
Return on investment (ROI)
Indicates how much profit a company generates relative to the amount of money
invested in it. It is calculated by dividing net profit by total investment.
Revenue
Is the total amount of money that a company earns from its business activities. It
includes sales revenue, interest revenue, and other types of income.
Red Dot Now provides accounting, payroll and tax compliance services using the
best of breed online technology.
Should you want to discuss this, or any of our services further, contact Ryan Coates
on e-mail at ryan@reddotnow.co.za