Business Terms
Plain-English definitions of the business and accounting terms you will run into.
- Burn rate
Burn rate is the average amount a business spends per month.
- Cash balance
Cash balance is the total money held across all connected checking and savings accounts.
- Cash runway
Cash runway is the number of months a business can keep operating at its current rate of spending before it runs out of money.
- Days to get paid
Days to get paid is the average number of days between issuing an invoice and receiving payment. In accounting it is called days sales outstanding.
- Money owed to you
Money owed to you is the total customers have been invoiced for but have not yet paid. In accounting it is called accounts receivable.
- Profit margin
Profit margin is the percentage of revenue a business keeps after expenses.