## Financial Terms Glossary

## C

## Cash flow statement

The cash flow statement is one of the basic three financial statements. The format is cash receipts minus cash payments. The cash flow statement shows the net cash increase or decrease for the period. Also called the statement of cash flows.

## Cash basis accounting

In cash basis accounting, revenue is recognized when cash is received from customers. Expenses are recognized when cash is paid. Cash basis net income is cash revenues minus cash expenses.

The benefit of cash basis is that it is simpler and easier to understand. Cash basis is only appropriate for small businesses. In the United States, C corporations cannot use cash basis and must use accrual basis.

## Cash ratio

The cash ratio is one of the liquidity ratios. It measures the dollars of cash for each dollar of current liabilities. Assets and liabilities are shown on a company’s balance sheet. The formula is:

## Command key

The Command ⌘ key is a modifier key on Mac keyboards. The function of the Command ⌘ key is to enable time-saving keyboard shortcuts on macOS. If a Windows keyboard is used with a Mac, the Windows key functions as the Mac Command ⌘ key.

The Command key started as the Apple Logo Key in 1980. The Command ⌘ symbol replaced the Apple logo in 1984. It is located at the left and the right of the space bar at the bottom of the Mac keyboard.

## Compound annual growth rate (CAGR)

Compound annual growth rate (CAGR) is the return required to grow an investment’s beginning value to its future value over a given number of years. CAGR is the measure of an investment’s growth over time. CAGR includes compound interest and is thus superior to average annual returns.

## Compound interest

Compound interest accrues on both the principal and the accumulated interest. It can be thought of as interest on interest. Because of this exponential growth, compound interest grows faster than simple interest. Compound interest is the key concept in Time Value of Money calculations.

## Cryptocurrency

Cryptocurrency or crypto is digital currency that is secured by cryptography. Transactions are verified on a public decentralized blockchain by all members. This solves the problem of counterfeiting and double spending.

Notable cryptocurrencies include bitcoin, ethereum, and tether.

## Current ratio

The current ratio is the most common liquidity ratio. It measures the dollars of current assets for each dollar of current liabilities. Assets and liabilities are shown on a company’s balance sheet.

The current ratio is also called the **liquidity ratio** or the **working capital ratio**. The formula is: