Definition of continuous loss

continuous loss

any reduction in units that occurs uniformly
throughout a production process

Base probability of loss

The probability of not achieving a portfolio expected return.

Capital loss

The difference between the net cost of a security and the net sale price, if that security is sold at a loss.

Continuous compounding

The process of accumulating the time value of money forward in time on a
continuous, or instantaneous, basis. Interest is earned continuously, and at each instant, the interest that
accrues immediately begins earning interest on itself.

Continuous random variable

A random value that can take any fractional value within specified ranges, as
contrasted with a discrete variable.

Net operating losses

losses that a firm can take advantage of to reduce taxes.

Paper gain (loss)

Unrealized capital gain (loss) on securities held in portfolio, based on a comparison of
current market price to original cost.

Residual losses

Lost wealth of the shareholders due to divergent behavior of the managers.

Stop-loss order

An order to sell a stock when the price falls to a specified level.

Profit and Loss account

A financial statement measuring the profit or loss of a business – income less expenses – for an accounting period.

extraordinary gains and losses

No pun intended, but these types of gains
and losses are extraordinarily important to understand. These are nonrecurring,
onetime, unusual, nonoperating gains or losses that are
recorded by a business during the period. The amount of each of these
gains or losses, net of the income tax effect, is reported separately in the
income statement. Net income is reported before and after these gains
and losses. These gains and losses should not be recorded very often, but
in fact many businesses record them every other year or so, causing
much consternation to investors. In addition to evaluating the regular
stream of sales and expenses that produce operating profit, investors
also have to factor into their profit performance analysis the perturbations
of these irregular gains and losses reported by a business.

profit and loss statement (P&L statement)

This is an alternative moniker
for an income statement or for an internal management profit report.
Actually, it’s a misnomer because a business has either a profit or a loss
for a period. Accordingly, it should be profit or loss statement, but the
term has caught on and undoubtedly will continue to be profit and loss
statement.

Continuous Compounding

The process of continuously adding interest to a principal plus
interest amount and calculating the resulting compound amount

Continuous Discounting

The process of calculating the present value of a stream of future
cash flows by discounting over a continuous period of time

continuous budgeting

a process in which there is a rolling
twelve-month budget; a new budget month (twelve months
into the future) is added as each current month expires

continuous improvement

an ongoing process of enhancing employee task performance, level of product quality, and level of company service through eliminating nonvalue-added activities to reduce lead time, making products
(performing services) with zero defects, reducing
product costs on an ongoing basis, and simplifying products
and processes

discrete loss

a reduction in units that occurs at a specific
point in a production process

loss

an expired cost that was unintentionally incurred; a cost
that does not relate to the generation of revenues

normal loss

an expected decline in units during the production process

Loss

An excess of expenses over revenues, either for a single business transaction or in
reference to the sum of all transactions for an accounting period.

Loss carryback

The offsetting of a current year loss against the reported taxable
income of previous years.

Loss carryforward

The offsetting of a current year loss against the reported taxable
income for future years.

Extraordinary Gain or Loss

Gains and losses that are judged to be both unusual and nonrecurring.

Impairment Loss

A special, nonrecurring charge taken to write down an asset with an overstated
book value. Generally an asset is considered to be value-impaired when its book value
exceeds the future net cash flows expected to be received from its use. An impairment write-down
reduces an overstated book value to fair value.

Realized Gains and Losses

Increases or decreases in the fair value of an asset or a liability that
are realized through sale or settlement.

Credit Loss

A loan receivable that has proven uncollectible and is written off.

capital loss

The negative difference between the adjusted cost base of an investment held as a capital property and the proceeds of disposition you receive when you sell it. When you sell such an investment for less than you paid, you incur a capital loss.

Job Loss Insurance (Credit Insurance)

Coverage that can pay down your debt should you become involuntarily unemployed. The payment is made to your creditors to reduce your debt owing.

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