What Is Recapitalization? Recapitalization is the process of restructuring a company’s debt and equity mixture, often to stabilize a company’s capital structure. The process mainly involves the exchange of one form of financing for another, such as removing preferred shares from the company’s capital structure and replacing them with bonds. Key Takeaways: Recapitalization is the
What Is Recapture? Recapture is a condition set by the seller of an asset that gives him/her the right to purchase back some or all of the assets within a certain period of time. In this way, it is similar to a repurchase agreement (repo). Recapture also refers to a situation in which an individual
What Is a Recapture Clause? A recapture clause refers to a lease provision common in commercial properties that allows the landlord to terminate a lease and retain possession of a property. Key Takeaways A recapture clause is a component of a commercial lease contract that says the landlord may reclaim the property ahead of the
What Is a Receipt? A receipt is a written acknowledgment that something of value has been transferred from one party to another. In addition to the receipts consumers typically receive from vendors and service providers, receipts are also issued in business-to-business dealings as well as stock market transactions. Key Takeaways Receipts are an official record
What Is the Accounts Receivables Turnover Ratio? The accounts receivables turnover ratio measures the number of times a company collects its average accounts receivable balance. It is a quantification of a company’s effectiveness in collecting outstanding balances from clients and managing its line of credit process. An efficient company has a higher accounts receivable turnover
What Is a Receiver? A receiver is a person appointed as custodian of a person or entity’s property, finances, general assets, or business operations. Receivers can be appointed by courts, government regulators, or private entities. Receivers seek to realize and secure assets and manage affairs to pay debts. For businesses, receivers seek to maximize profits and
What Is a Receivership? A receivership is a court-appointed tool that can assist creditors to recover funds in default and can help troubled companies avoid bankruptcy. Having a receivership in place makes it easier for a lender to recover funds that are owed to them if a borrower defaults on a loan. A receivership may
What Is a Recession? Investopedia / Laura Porter A recession is a significant, widespread, and prolonged downturn in economic activity. A common rule of thumb is that two consecutive quarters of negative gross domestic product (GDP) growth mean recession, although more complex formulas are also used. Economists at the National Bureau of Economic Research (NBER)
What Is a Recessionary Gap? A recessionary gap, or contractionary gap, is a macroeconomic term used when a country’s real gross domestic product (GDP) is lower than its GDP at full employment. Key Takeaways A recessionary gap, or contractionary gap, occurs when a country’s real GDP is lower than its GDP at full employment.Recessionary gaps
What Is a Reverse Convertible Note (RCN)? A reverse convertible note (RCN) is a financial product that shares characteristics with both bonds and stocks. A coupon-bearing investment, it offers a payout at maturity which depends on the performance of an underlying stock. Structured as high-yield short-term investments, most RCNs have maturity periods of three months to
