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natural resources: Assets that are physically consumed or waste away, such as oil, minerals, gravel, and timber.

net assets (owners' equity): The ownership interest in the assets of an entity; equal total assets minus total liabilities.

net income (or net loss): A measure of the overall performance of a business entity; equal to revenues minus expenses for the period.

net proceeds: The difference between maturity value and discount when a note receivable is discounted.

net realizable value: The selling price of an item less reasonable selling costs.

net realizable value of accounts receivable: The net amount that would be received if all receivables considered collectible were collected; equal to total accounts receivable less the allowance for uncollectible accounts; also called the book value of accounts receivable.

net sales: Gross sales less sales discounts and sales returns and allowances.

net tax liability: The amount of tax computed by subtracting tax credits from the gross tax liability.

nominal accounts: Accounts that are closed to a zero balance at the end of each accounting period; temporary accounts generally appearing on the income statement.

noncash items: Items included in the determination of net income on an accrual basis that do not affect cash; examples are depreciation and amortization.

noncash transactions: Investing and financing activities that do not affect cash; if significant, they are disclosed below the statement of cash flows or in the notes to the financial statements.

nonoperating assets: Investment and other assets not used in a business but held to earn a return separate from operations.

nonprofit organization: An entity without a profit objective, oriented toward providing services efficiently and effectively.

no-par stock: Stock that does not have a par value printed on the face of the stock certificate.

note payable: A debt owed to a creditor, evidenced by an unconditional written promise to pay a certain sum of money on or before a specified future date.

note receivable: A claim against a debtor, evidenced by an unconditional written promise to pay a certain sum of money on or before a specified future date.

notes to financial statements: Explanatory information considered an integral part of the financial statements.

NSF (not sufficient funds) check: A check that is not honored by a bank because of insufficient cash in the customer's account.

number of days' of inventory on hand: An alternative measure of how well inventory is being managed; computed by dividing 365 days by the inventory turnover ratio.

number of days' sales in receivables: A measure of the average number of days it takes to collect a credit sale; computed by dividing 365 days by the accounts receivable turnover.

number of days' sales invested in working capital: An alternative measure of the amount of working capital used in generating the sales of a period; computed by dividing 365 days by the working capital turnover.  

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