What is Hammer Candlestick Pattern: Definition & Meaning Explained

Deferred Tax Asset

A deferred tax asset is an item on a company’s financial statement that can be used to get tax relief, generally in the event of overpaying taxes or net losses that are carried forward.

Companies tend to deduct these overpayments or losses for accounting purposes and to reduce their overall taxable income. Common examples of deferred tax assets include:

Depreciation of fixed assets
Net financial loss
Bad debt

Direct Public Offerings

A Direct Public Offering or DPO allows a company to issue shares directly to the public without an intermediary like investment banks. In the process, the company becomes publicly traded.

The cost of a DPO is known to be relatively low compared to an IPO.

Furthermore, the issuer of the DPO has control over the issue price while the paperwork and effort involved is also comparatively low. That said, the company must go through proper regulatory procedures during the process.

Acceptance Credit

Acceptance Credit is a way for buyers to authorize fund transfers to sellers at a specific date when various terms & conditions are met.

This is done through a letter of credit which is a creditworthy bank’s promise that the payment will be made.

There are two types of Acceptance Credit:

Confirmed: Bank guarantees payment in case the buyer defaults
Unconfirmed: Bank does not guarantee payment in case the buyer defaults

Accrued Expenses

An accrued expense is the cost that is incurred in the current accounting period but is due to be paid in the future.

More simply, an accrued expense is an unpaid bill due in the future for goods or services that have already been received by a company.

Accrued expenses show up as liabilities on a company’s books.

Cash and Cash Equivalents

Cash and cash equivalents are short-term assets or holdings which fall under the current assets of a business. Cash and cash equivalents have very high liquidity. When you take the term literally, you have two components:

Cash: money like cash holdings in a bank account, petty cash, and others
Cash equivalents: assets or investments like T-bills, commercial paper, and others that have a short maturity which can easily be converted into cash

Hammer Candlestick Pattern