"Where Everyone Has an MBA"
Tel: (612) 246-4616
Tel: (612) 246-4616
ENDOWMENT is a permanent fund where gifts to the fund are held in perpetuity and where earnings are used in accordance with the donor's specified wishes.
REVOLVING CREDIT is a line of credit extended to customers who may use it as often as desired up to a certain dollar limit. Items purchased using this line of credit may be paid in full upon receipt of a monthly statement, or they may be paid for in several installments, for which an interest charge is added. Also known as REVOLVING LINE OF CREDIT.
HISTORICAL COST CONVENTION is that assets are recorded at their initial cost and are not subsequently revalued upwards, and liabilities valued at the amount initially received in exchange for the obligation. The relevance of the convention is that figures remain objectively based on verifiable figures, but in times of high inflation historical cost can become a dubious convention to follow.
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