Glossary

The accounting rules for financial presentation of a business's income, expenses, assets and liabilities. The standards are set by the Financial Accounting Standards Board (FASB) a non-profit organization. The rules are modified from time to time.

Includes all of business assets and equipment, may include property or land.

In a partnership, a partner whose liability is not limited. All partners in an ordinary partnership are general partners. A limited partnership must have at least one general partner.

A deposit made by a purchaser of real estate to evidence an honesty.

Good Will is an Intangible Asset on a business's balance sheet, generally arising from the difference between the purchase price paid for the business minus the net value of its assets (assets minus liabilities).

Rents that are partly paid by the government (e.g. Section 8 residential subsidies).

A door at the ground level at the foundation.

A lease in which the rent is fixed for the initial term and increases at certain set intervals by predetermined amounts or by amounts based on periodic appraisals.

Part of SBA_s public policy program which recognizes businesses that create renewable energy resources o reduce their own energy consumption by 10% or more as being eligible for increased SBA financing.

A tool used to assess the approximate value of a rental property by comparing its rental income with other like properties. It gives the relationship between the gross rental income and sales price.

This is used primarily for income producing or investment real estate to gauge the potential future revenue stream. It is the rent which would be collected if all units were leased at market rents.

Gross Profit is calculated by taking the revenue generated by the business and deducting the cost of acquiring and/or producing the goods sold or providing the service performed. It generally does not include costs attributable to indirect labor, taxes, rent, utilities and interest.

This is calculated by dividing the Gross Profit by the revenues. It provides some guidance as to whether the pricing for the products or services are adequate or too low and whether the costs associated are adequate or too high. The margin should be large enough to cover operating and other expenses and provide a reserve for growth.

Multiplier: A tool used to assess the approximate value of a rental property by comparing its rental income with other like properties. It gives the relationship between the gross rental income and sales price. Also referred to as gross income multiplier.

Gross Revenue is the income generated by a business or property before deducting expenses.

Existence and/or number of ground level doors.

Generally the obligation of one party to pay or assume the obligation of another if the other does not pay. A guarantee may be an Unlimited Guarantee or it may be a Limited Guarantee. A Limited Guarantee may provide that the person guaranteeing (Guarantor) is only responsible for certain obligations or amounts.