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Glossary of Business Terms

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NAICS North American Industry Classification System. Replaced the U.S. Standard Industrial Classification (SIC) system on January 1, 1997. NAICS is the first-ever North American industry classification system. The system was developed by the U.S., Canada, and Mexico to provide comparable statistics across the three countries. NEGOTIATION The process used to confer with another so as to arrive at the settlement of some matter. NEGOTIATION DISPUTE That point in negotiations where the parties cannot come to an agreement on some or all of the issues on the bargaining table. NET PROFIT (before taxes) A company's earnings, reflecting revenues adjusted for costs of doing business, depreciation, interest and other expenses. Also called pre-tax net earnings or or pre-tax bottom line. NET WORTH Property owned (assets), minus debts and obligations owed (liabilities), is the owner's equity (net worth.) NON-COMPETE AGREEMENT A contract that restricts participation in a certain market by a company or individual(s) under specific circumstances. Buyers almost always require Sellers to sign a non-compete agreement to deter them from starting a competing business or joining a competitor. NOTES AND ACCOUNTS RECEIVABLE A secured or unsecured receivable evidenced by a note or open account arising from activities involving liquidation and disposal of loan collateral.


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