Business Terminology:

Cap  Rate - Capitalisation Rate  - It is the % Return on an Investment. Used to compare Business etc

For example $100,000 in the bank, Interest Paid $6,000 year is a Return on Investment of 6%

For example $100,000 invested in a business may return 30% or $30,000 per year

Depreciated Value- Tax term for diminishing values of plant & equipment, vehicles,
fixtures and fittings.

E.B.I.T - Earnings Before Interest & Tax After Proprietor or Manager's Wage

Freehold - The Land and any Fixed Improvements and or Buildings.

GST. Goods & Services Tax (Currently 10%)

GP Gross Profit. - Also known as Margin or Profit

The Difference between Cost Price and Selling Price


GP% - (Gross Profit Percentage) Is the $ and or cents of Profit Expressed as a % of the Selling Price.

How To Find the Gross Profit in Money & Express it as a %:

Click here for a Printer Friendly Copy of  GP% & MU% Document

MU  - Mark Up - The amount of Profit (In $ & Cents) that is added to the Cost Price

MU% - It is the Mark Up amount of Profit (added to the Cost Price) expressed as a % of the Cost Price

How Do we Mark Up a Product to achieve a Selling price?

Click here for a Printer Friendly Copy of  GP% & MU% Document

P.E.B.I.T - Proprietors Earnings Before Interest & Tax

P.E.B.I.T.A - Proprietors Earnings Before Interest, Tax & Amortisation

P.E.B.I.T.D.A. - Proprietors Earnings Before Interest, Tax, Depreciation  & Amortisation

T.A.P To Approved Purchaser

Leasehold Business- The land & Buildings is rented or leased from the landlord (Owner)

R.O.I - Return on Investment  - See Cap Rate at top of page

S.A.V - Stock at valuation. ( Normally last invoice cost price.)

W.I.W.O - Walk in walk out Includes Stock at time of sale, Plant & Equipment, Goodwill etc



For an explanation of commonly used Business terms call Kevin Bishop -

Abisha Business & Property Sales. Abisha Pty L td    -  Business & Property Sales