What Is a Debt Cancellation Contract (DCC)? A debt cancellation contract (DCC) is a contractual arrangement modifying loan terms. Under the DCC, a bank agrees to cancel all or part of a customer’s obligation to repay a loan or credit. These contracts become effective upon the occurrence of a specified event as written into the contract, and
What Is a Debit Memorandum? A debit memorandum, or “debit memo,” is a document that records and notifies a customer of debit adjustments made to their individual bank account. The adjustments made to the account reduce the funds in the account but are made for specific purposes and used only for adjustments outside of any
What Is a Debit Note? A debit note is a document used by a vendor to inform the buyer of current debt obligations, or a document created by a buyer when returning goods received on credit. The debit note can provide information regarding an upcoming invoice or serve as a reminder for funds currently due.
What Is a Debit Spread? A debit spread, or a net debit spread, is an options strategy involving the simultaneous buying and selling of options of the same class with different strike prices requiring a net outflow of cash, or a “debit,” for the investor. The result is a net debit to the trading account. Here, the
What Is a Debit Ticket? A debit ticket is an entry by a bookkeeper or an accountant that indicates a sum of money that is owed but not yet paid by the business. It reduces the balance of the general ledger by that sum. When payment is received a corresponding credit is entered to cancel
What Is Debris Removal Insurance? Debris removal insurance is a section of a property insurance policy that provides reimbursement for clean-up costs associated with damage to property. Policies with a debris removal provision typically only cover debris resulting from an insured peril, such as charred wood or twisted metal from a building fire. How Debris
What Is the Debt-to-EBITDA Ratio? Debt/EBITDA—earnings before interest, taxes, depreciation, and amortization—is a ratio measuring the amount of income generated and available to pay down debt before covering interest, taxes, depreciation, and amortization expenses. Debt/EBITDA measures a company’s ability to pay off its incurred debt. A high ratio result could indicate a company has a
What Are Debt Accordions? A debt accordion, also known as an incremental facility, is a provision that allows a borrower to expand the maximum amount allowed on a line of credit (LOC), or to add a term loan to an existing credit agreement. Key Takeaways Debt accordions are provisions that allow a borrower to increase the maximum
What Is a Debt Avalanche? A debt avalanche is a type of accelerated debt repayment plan. Essentially, a debtor allocates enough money to make the minimum payment on each source of debt, then devotes any remaining repayment funds to the debt with the highest interest rate. Using the debt avalanche approach, once the debt with the highest interest
David Ricardo (1772–1823) was a classical economist best known for his theory on wages and profit, the labor theory of value, the theory of comparative advantage, and the theory of rents. David Ricardo and several other economists also simultaneously and independently discovered the law of diminishing marginal returns. His most well-known work is Principles of
