GAAP see GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.

G&A
Usually refers to the indirect overhead costs contained within the General and Administrative expense / cost categories (see also SG&A).

Gain
Is: a) the amount by which the revenue of a business exceeds its cost of operating;
b) rise in rate or price; c) earn on some commercial or business transaction; d) earn as salary or wages.

GAO
The investigative arm of the United States Congress charged with examining matters relating to the receipt and payment of public funds.

Garbage In, Garbage Out (GIGO)
An often used computer and software industry saying meaning that if the data going into a system is suspect, the resulting data output will be suspect.

GASB
Stands for Government Accounting Standards Board. The GASB is a nonprofit organization responsible for establishing and improving accounting and financial reporting standards for governmental units.

Garnishment
Court judgment ordering a lender to be given part of the wages or salary of a borrower who has defaulted on a loan.

Gearing
The proportion of the capital employed of a company that is financed by lenders rather than shareholders.

Generally Accepted Accounting Principles (GAAP)
The rules and guidelines that certified public accountants (CPAs) use when preparing financial statements.

General Journal
The most basic of journals. It is a chronological list of transactions. It has a very specific format for recording each transaction. Each transaction is recorded separately and consists of: 1) a date; 2) any and all accounts to receive a debit entry are listed first with an amount in the appropriate column, then; 3) any and all accounts to receive a credit entry are indented and listed next with an amount in the appropriate column; 4) a clear description of the transaction. At least one line is then skipped to visually separate recorded transactions.

General Ledger
The ledger that contains all of the financial accounts of a business; contains offsetting debit and credit accounts (including control accounts).

General Partner
A co-owner of a business. General partners receive a share of the business’s profit and are partly responsible for its debts and liabilities.

Gift Tax
A tax on gifts of cash or property. Gift taxes are paid by the donor.

Globalization
The name for the process of increasing the connectivity and interdependence of the world's markets and businesses. In its literal sense, globalization is a social change, an increased connectivity among societies and their elements due to transculturation; the explosive evolutions of transport and communication technologies to facilitate international cultural and economic exchange are examples of globalization.

Going Concern
Name to describe a business that is in operation and is expected to remain so in the future.

Golden Rules Of Accounting
Are: 1. Debits ALWAYS EQUAL Credits; 2. Increases DO NOT NECESSARILY EQUAL Decreases; and, 3. Assets - Liabilities = Owner's Equity (The Accounting Equation).

Goodwill
That intangible possession which enables a business to continue to earn a profit that is in excess of the normal or basic rate of profit earned by other businesses of similar type. The goodwill of a business may be due to a particularly favorable location, its reputation in the community, or the quality of its employer and employees. The evidence that goodwill exists is the proven ability to earn excess profits. Goodwill is created on the books of a newly purchased company to the extent that the purchase price of the company is greater than the value of its net tangible assets. There are a number of methods for valuing goodwill: a. Simple Capitalization - The net profit of the business is capitalized to determine the total value of the business. The value of all the tangible assets is subtracted from the total value to establish the value of the intangible assets, or goodwill. b. Excess Earnings - the amount of earnings that are in excess of those normally earned by a similar business are capitalized to determine the value of goodwill. c. Income Tax Method - The past five years net income is averaged and a reasonable expected rate of return for tangible assets and salary requirements are subtracted. The resulting value is then capitalized to arrive at the goodwill value. d. Market Value - The price a willing seller would accept and a willing buyer would pay for goodwill. e. Buy /Sell Agreement - The value of goodwill is established by a formula in the buy/ sell agreement. f. Rule of Thumb - Goodwill is worth one years gross income.

Grace Period
The period of time during which a loan payment is to be paid. If the payment is not made during the grace period, it is overdue.

Grantee
The person or entity to whom property or assets are transferred.

Grantor
A person who writes a deed passing property from one party to another.

Gross
Is: a) the entire amount of income before any deductions are made; or, b) any total amount before any deductions (examples: gross income or gross labor).

Gross Estate
The property in an estate before debts, taxes, and other expenses are paid. The net estate is what remains after these expenses are paid.

Gross Profit  
Net sales minus cost of sales.




 

Gross Receipts
The total amount received prior to the deduction of any allowances, discounts, credits, etc.

Gross Revenue
Income (at invoice values) received for goods and services over some given period of time. See also GROSS SALES.

Gross Sales
The total revenue at invoice value prior to any discounts or allowances. See also GROSS REVENUE.

Guarantor
A person or corporation that guarantees a debt will be paid if another party defaults. Guarantors are considered co-endorsers of a debt and are therefore liable for the debt.

H Bond
A U.S. government bond, or savings bond.

HH Bond
A U.S. government bond, or savings bond. HH bonds are sold in denominations of $500 to $10,000.

Head Of Household
A U.S. income tax filing status that can be used by an unmarried person who maintains a home for a dependent (or nondependent relative) during the tax year.

Head Tax
A tax that imposes the same amount of tax on every individual in a class or group.

Hedge
In securities, is a transaction that reduces the risk of an investment.

High-Low Method
An algebraic procedure used to separate a semi-variable cost into the variable and fixed components. The method calls for using the extreme data points (highest and lowest x - y pairs) in the COST-VOLUME FORMULA y = a + bx; where a = fixed cost portion and b = the variable rate.

Historical Cost Accounting
An accounting principle requiring all financial statement items to be based on original cost. It is usually based upon the dollar amount originally exchanged in an arm's-length transaction; an amount assumed to reflect the fair market value of an item at the transaction date.

Holding Company
A company which owns or controls other companies. (Control can occur through the ownership of 50 per cent or more of the voting rights or through the exercise of a dominant influence.)

Horizontal Financial Analysis
Allows comparison of one company's ratios to the ratios of other companies as well as to average industrial ratios and internal industrial deviation of these ratios.

Homestead Exemption
An exemption from liability that prevents creditors from obtaining satisfaction from a debtor's homestead.

Hurdle Rate 
A term used in the budgeting of capital expenditures meaning the REQUIRED RATE OF RETURN in a DISCOUNTED CASH FLOW analysis. If the expected rate of return on an investment is below the hurdle rate, the project is not undertaken. The hurdle rate should be equal to the INCREMENTAL COST OF CAPITAL.