BUSINESS TERMS — BILKUL SIMPLY
Bilkul Bazaar | Sunday Special
1. ASSETS
What it means:
Everything valuable that a business owns or controls—such as cash, buildings, machinery, vehicles or inventory.
Example:
A bakery’s ovens, cash, furniture and stock of ingredients are its assets.
2. LIABILITIES
What it means:
Money or obligations that a business owes to others, such as loans, unpaid bills or other debts.
Example:
If a company has taken a ₹10 lakh business loan, that loan is a liability.
3. EQUITY
What it means:
The owners’ stake in a business after its liabilities are deducted from its assets.
Example:
If a business has assets worth ₹50 lakh and liabilities of ₹20 lakh, its equity is ₹30 lakh.
4. ROI
What it means:
Return on Investment measures how much return is generated from money invested.
Example:
If you invest ₹1 lakh in a business and earn ₹20,000 from that investment, the ROI is 20%.
5. LIQUIDITY
What it means:
How easily a business can access cash or convert assets into cash to meet its short-term obligations.
Example:
A company with enough cash to pay its upcoming bills has good liquidity.
BILKUL SIMPLY
Assets are what you have.
Liabilities are what you owe.
Equity is what belongs to the owners.
ROI tells you what your investment earned.
Liquidity tells you how easily you can meet immediate payments.
Know the Term. Understand the Business.
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