Business / Finance Glossary

Corporate Processing Float: This section will usually present (1) the company's executive office address and telephone number; (2) identifies each principal corporate officer by name and position followed by three numb . . . View Full Definition

Corporate Repurchase: The time that elapses between receipt of payment from a customer and the deposit of the customer's check in the firm's bank account; the time required to process customer payments.

Corporate Tax View: Active buying by a corporation of its own stock in the marketplace. Reasons for repurchase include putting idle cash to use, raising EPS, creating support for a stock price, increasing inter . . . View Full Definition

Corporate Taxable Equivalent: The argument that double (corporate and individual) taxation of equity returns makes debt a cheaper financing method.

Corporation: Rate of return required on a par bond to produce the same after-tax yield to maturity that the quoted premium or discount bond would generate.

Correction: A legal entity that is separate and distinct from its owners. A corporation is allowed to own assets, incur liabilities, and sell securities, among other things.

Correlation: Reverse movement, usually downward, in the price of an individual stock, bond, commodity, or index. If prices have been rising on the market as a whole, and then fall dramatically, this is k . . . View Full Definition

Correlation Coefficient: Statistical measure of the degree to which the movements of two variables (stock/option/convertible prices or returns) are related. See: Correlation coefficient.

Correspondent: A standardized statistical measure of the dependence of two random variables, defined as the covariance divided by the standard deviations of two variables.

Cost: A financial organization that performs services (acts as an intermediary) in a market for another organization that does not have access to that market.

Cost Accounting: Another term for expenditure. See also expenses.

Cost Basis: A branch of accounting that provides information to help the management of a firm evaluate production costs and efficiency.

Cost Company Arrangement: The original price of an asset, used to determine capital gains.

Cost Me: Arrangement whereby the shareholders of a project receive output free of charge but agree to pay all operating and financing charges of the project.

Cost Of Capital: Refers to over-the-counter trading. 'The price I must pay to obtain the securities you wish to buy is [$]'. Usually, a standard markup (1/8) is then applied for resale to this buyer. Antithe . . . View Full Definition

Cost Of Carry: The required return for a capital budgeting project.

Cost Of Equity: Out-of-pocket costs incurred while an investor has an investment position. Examples include interest on long positions in margin account, dividend lost on short margin positions, and inciden . . . View Full Definition

Cost Of Funds: The required rate of return for an investment of 100% equity.

Cost Of Goods Sold: Interest rate associated with borrowing money.

Cost Of Lease Financing: Another term for cost of sales.

Cost Of Limited Partner Capital: A lease's internal rate of return.

Cost Of Sales-Services (COS): The discount rate that equates the after-tax inflows with outflows for capital raised from limited partners.

Cost Records: All the costs associated with the goods or services that were sold during a specified accounting period, including materials, labor, and overhead.

Cost-Benefit Ratio: The records maintained by an investor of the prices at which securities transactions are made, so that capital gains can be computed.

Cost-Of-Carry Market: The net present value of an investment divided by the investment's initial cost. Also called the profitability index.

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