personal financial statement
a summary of your current personal financial condition, also known as a snapshot of your finances
asset
anything of monetary value that you own, such as cash, checking and savings accounts
liability
a debt that you owe to others, such as credit card debt, school loans, car payments, or taxes
net worth
the difference between your assets and your liabilities
start-up costs
projections of how much money you will need for your first year of operation
income statement
a summary of income and expenses during a specific period such as a month, a quarter, or a year
gross sales
the total of all sales for any period of time
net income
the amount left after the total expenses are subtracted from gross profit
interest
the money paid for the use of money borrowed or invested
principal
the amount you borrowed to start your business
balance sheet
a summary of a business's assets, liabilities, and owner's equity
cash flow statement
a monthly plan that tracks when you anticipate that cash will come into the business and when you expect to pay out cash