What Is Accumulated Income? Accumulated income, commonly referred to as retained earnings, includes the portion of net income that is retained by a corporation over time, rather than being distributed as dividends. Any accumulated income is typically used by the corporation to reinvest in its principal business or to pay down its debt. Key Takeaways
What Is an Accumulated Income Payment (AIP)? Accumulated income payments (AIP) refers to funds withdrawn from a Canadian Registered Education Savings Plan (RESP) if the beneficiary decides not to attend college. In this case, the returns generated in the RESP aren’t forfeited as long as the subscriber fulfills certain criteria. Key Takeaways Accumulated income payments
What Is an Accumulation Bond? An accumulation bond is a type of security that is sold at a discount, known as an original issue discount (OID). An OID is a discount from par value (also known as “face value”) at the time the bond is issued. The bond will gradually return to that value over a given period
What Is the Accumulation/Distribution Indicator (A/D)? The accumulation/distribution indicator (A/D) is a cumulative indicator that uses volume and price to assess whether a stock is being accumulated or distributed. The A/D measure seeks to identify divergences between the stock price and the volume flow. This provides insight into how strong a trend is. If the
What Is an Accumulation Option? An accumulation option is a policy feature of permanent life insurance that reinvests dividends back into the policy, where it can earn interest. Some types of insurance pay dividends to their policyholders each year when the insurance company performs better than estimated. Accumulation options are one of several options policyholders have for what
What Is the Accumulation Phase? Accumulation phase has two meanings for investors and those saving for retirement. It refers to the period when an individual is working and planning and ultimately building up the value of their investment through savings. The accumulation phase is then followed by the distribution phase, in which retirees begin accessing
What Is an Accumulation Plan? An accumulation plan is a general financial strategy in which an investor attempts to build the value of a portfolio. In the context of mutual funds, an accumulation plan is a formal arrangement in which an investor contributes a specified amount of money to the fund on a periodic basis.
What Is the Automated Clearing House (ACH)? The Automated Clearing House (ACH) is an electronic funds-transfer system run by Nacha. The Automated Clearing House traces its roots back to the late 1960s but was officially established in the mid-1970s. The payment system provides many types of ACH transactions, such as payroll deposits. It requires a
What Is Accounts Receivable Conversion (ARC)? Accounts receivable conversion (ARC) is a process that allows paper checks to be electronically scanned and converted into an electronic payment through the Automated Clearing House (ACH). This refers explicitly to checks that companies receive in payment for an account receivable. Accounts receivable conversion saves both the time and
What Are Accounts Receivable (AR) Discounted? Accounts receivable discounted refers to the selling of unpaid outstanding invoices for a cash amount that is less than the face value of those invoices. It is an accounting tactic that discounts the value of accounts receivable (AR) on a company’s balance sheet in return for cash balances. Key
