Unrealized Gain – Explained

by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting

What is Unrealized Gain?An unrealized gain is a type of profit that an investor, company, or individual is yet to receive but is expected to make in the future from the sale of an asset. Basically, it is the increase in value of an asset. Once assets are sold in...

Traditional IRA – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Traditional IRA?A traditional IRA (individual retirement account) is a retirement savings strategy that offers tax deductions or tax advantages to employees. In a traditional IRA plan, employees or individuals can do investment with their pre-tax income,...

Phantom Income – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Taxation

What is Phantom Income?Phantom income, or phantom revenue, refers to money, income, or investment gain that an individual is yet to receive but is still subjected to taxes by the Internal Revenue Service. Such income poses a lot of problems for the taxpayers because...

Personal Exemption (Taxation) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Taxation

What is a Personal Exemption?A personal exemption refers to the amount of money that a single taxpayer can claim as a tax deduction, this deduction is claimed on personal income and federal income tax. The amount an individual can deduct under personal exemption is...

Instructing Bank – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is an Instructing Bank?What Does an Instructing Bank Do?Instructing Bank and Wire Transfer What is an Instructing Bank?A financial transaction that entails the transfer of funds between two parties require that the presence of two banks....

Legal Lending Limit – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is a Legal Lending Limit?How Does a Legal Lending Limit Work?Calculating Lending LimitsExceptions to Legal Lending Limits?Capital and Surplus What is a Legal Lending Limit?The legal lending limit refers to the highest amount that a bank...

Innocent Spouse Rule – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Taxation

What is the Innocent-Spouse Rule?In the United States, the innocent spouse rule is a provision that grants a spouse relief from penalties of improperly reported tax returns of their spouse. If a spouse is guilty of underpayment of taxes of files tax returns...

Requisition – Explained

by TheBusinessProfessor | Feb 23, 2025 | Operations, Project, & Supply Chain Management

What is a Requisition?Requisition is often used in procurement, it refers to a formal way of requesting goods and services form a department or supplier. It is generally in written form.There are certain situations where requisitions are used outside of purchase and...

Alienation Clause (Contract) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is an Alienation Clause?How Does an Alienation Clause Work?Mortgage Alienation Clause ConsiderationsAlienation Clauses in Insurance What is an Alienation Clause?An alienation clause is used in mortgage contracts, especially in commercial...

Texas Sharpshooter Fallacy – Explained

by TheBusinessProfessor | Feb 23, 2025 | Management, Leadership, & Organizational Behavior

What is the Texas Sharpshooter Fallacy?The Texas Sharpshooter Fallacy, commonly known as a clustering illusion or the hot hand fallacy, refers to the human tendency to analyze outcomes consisting of clusters in a random sequence of events as non-random. In simpler...