Accounting Dictionary - Letter M

• Management accounting: A branch of accounting that provides financial information to managers to help them make decisions.
• Managerial accounting: A branch of accounting that provides financial information to managers to help them make decisions.
• Manufacturing overhead: The indirect costs of producing a product, such as factory rent and utilities.
• Margin: The difference between a company's revenue and its cost of goods sold.
• Marginal analysis: A method of analyzing the costs and benefits of a decision by considering the additional costs and benefits of one more unit of production.
• Marginal cost: The additional cost of producing one more unit of a product.
• Marginal revenue: The additional revenue generated by selling one more unit of a product.
• Market capitalization: The total value of a company's outstanding shares.
• Market risk: The risk that a company's stock price will decline due to market conditions.
• Market value: The current price of a security or asset.
• Mark-to-market: A method of valuing a security or asset at its current market price.
• Matching principle: A principle of accounting that requires companies to match their revenues with their expenses.
• Material cost: The cost of raw materials used in production.
• Materiality: The significance of a financial transaction or event.
• Maturity date: The date on which a bond or other debt instrument matures.
• Maturity value: The face value of a bond or other debt instrument at maturity.
• Maximum tax: The highest tax rate applicable to a company or individual.
• Mean: A statistical measure of the average value of a set of numbers.
• Median: A statistical measure of the middle value of a set of numbers.
• Merger: The combination of two or more companies into a single entity.
• Method of accounting: A system of accounting that a company uses to record and report its financial transactions.
• Microeconomics: The study of the behavior of individual economic units, such as households and firms.
• Mid-year convention: A method of depreciation that assumes an asset is purchased or sold halfway through the year.
• Minority interest: The interest of a minority shareholder in a company.
• Minority shareholder: A shareholder who owns less than 50% of a company's outstanding shares.
• Mixed cost: A cost that has both fixed and variable components.
• Modified accrual accounting: A method of accounting that combines elements of accrual and cash basis accounting.
• Modified cash basis: A method of accounting that combines elements of cash and accrual basis accounting.
• Monetary policy: The actions of a central bank to control the money supply and interest rates.
• Money market: A market for short-term debt securities.
• Money supply: The total amount of money in circulation in an economy.
• Mortgage: A loan secured by real estate.
• Mortgage-backed security: A security that represents an interest in a pool of mortgages.
• Most recent transaction: The most recent transaction in a company's accounting records.
• Moving average: A statistical measure of the average value of a set of numbers over time.
• Multi-step income statement: An income statement that shows multiple levels of profitability.
• Municipal bond: A bond issued by a municipality to finance its activities.
• Mutual fund: A fund that pools money from multiple investors to invest in a variety of assets.
• Mandatory disclosure: The requirement that companies disclose certain information to the public.
• Management's discussion and analysis (MD&A): A section of a company's annual report that provides management's analysis of the company's financial performance.
• Management's report on internal control: A report that provides management's assessment of the company's internal control over financial reporting.
• Manufacturing cost: The cost of producing a product.
• Margin of safety: The difference between a company's revenue and its break-even point.
• Marginal benefit: The additional benefit of one more unit of production.
• Marginal cost of capital: The cost of raising one more dollar of capital.
• Market-based valuation: A method of valuing a company based on its market capitalization.
• Market capitalization ratio: A ratio that compares a company's market capitalization to its book value.
• Market efficiency: The ability of a market to reflect all available information in its prices.
• Market price: The current price of a security or asset.
• Market rate: The interest rate that is prevailing in the market.
• Market risk premium: The additional return that investors demand for taking on market risk.
• Market value added (MVA): A measure of a company's market value that is added by its management.
• Mark-to-market accounting: A method of accounting that values securities or assets at their current market price.
• Master budget: A comprehensive budget that outlines a company's financial plans.
• Material weakness: A weakness in a company's internal control over financial reporting.
• Maturity premium: The additional return that investors demand for taking on maturity risk.
• Maximum dividend payout ratio: The maximum percentage of earnings that a company can pay out as dividends.
• Mean absolute deviation (MAD): A statistical measure of the average absolute deviation of a set of numbers.
• Mean square error (MSE): A statistical measure of the average squared error of a set of numbers.
• Median absolute deviation (MAD): A statistical measure of the median absolute deviation of a set of numbers.
• Merger and acquisition: The combination of two or more companies into a single entity.
• Method of depreciation: A method of allocating the cost of an asset over its useful life.
• Microfinance: The provision of financial services to low-income individuals or small businesses.
• Mid-cap stock: A stock with a market capitalization that is between that of a small-cap and large-cap stock.
• Mid-term note: A debt instrument with a maturity of between 2 and 10 years.
• Minority shareholder rights: The rights of a minority shareholder in a company.
• Mixed economy: An economy that combines elements of capitalism and socialism.
• Modified internal rate of return (MIRR): A measure of the return on investment that takes into account the cost of capital.
• Monetary base: The total amount of money in circulation in an economy.
• Monetary policy committee: A committee that sets monetary policy for a country.
• Money laundering: The act of concealing the source of money obtained through illicit means.
• Money market fund: A fund that invests in low-risk, short-term debt securities.
• Money supply growth rate: The rate at which the money supply is growing.
• Mortgage-backed security (MBS): A security that represents an interest in a pool of mortgages.
• Most favored nation (MFN): A country that is granted the most favorable trade terms by another country.
• Moving average convergence divergence (MACD): A technical indicator that shows the difference between two moving averages.
• Multi-class stock: A stock that has multiple classes of shares with different voting rights.
• Multi-currency accounting: The accounting for transactions in multiple currencies.
• Multi-national corporation (MNC): A company that operates in multiple countries.
• Multi-period budget: A budget that covers multiple periods.
• Multi-step income statement: An income statement that shows multiple levels of profitability.
• Municipal finance: The financing of municipal activities through bonds and other debt instruments.
• Mutual fund fees: The fees charged by a mutual fund to its investors.
• Mandatory audit: An audit that is required by law or regulation.
• Management accounting system: A system of accounting that provides financial information to managers.
• Management auditor: An auditor who specializes in management accounting and auditing.

• Management buyout (MBO): A type of acquisition where a company's management team purchases the company from its existing shareholders.
• Management control system: A system of controls and procedures that are used to manage a company's operations and ensure that its objectives are met.
• Management information system (MIS): A system that provides information to management to help them make decisions.
• Management letter: A letter from a company's management to its shareholders or stakeholders that provides information about the company's performance and prospects.
• Management representation letter: A letter from a company's management to its auditors that provides representations about the company's financial statements and internal controls.
• Management's assertion: A statement made by a company's management about the company's financial statements or internal controls.
• Management's responsibility: The responsibility of a company's management to ensure that the company's financial statements are accurate and complete.
• Manufacturing accounting: A type of accounting that is used to track the costs of producing goods.
• Manufacturing cost accounting: A type of accounting that is used to track the costs of producing goods, including direct materials, direct labor, and overhead.
• Manufacturing overhead allocation: The process of allocating overhead costs to products or departments.
• Manufacturing process: The process of producing goods, including the conversion of raw materials into finished products.
• Margin call: A demand from a broker or other financial institution for a customer to deposit more funds or sell some of their positions.
• Margin of error: The amount by which a measurement or estimate may be incorrect.
• Marginal analysis of costs: An analysis of the costs of producing one more unit of a product.
• Marginal benefit of investment: The additional benefit of investing in a project or asset.
• Marginal cost of production: The additional cost of producing one more unit of a product.
• Marginal product of labor: The additional output that is produced by one more unit of labor.
• Marginal propensity to consume (MPC): The change in consumption that results from a change in income.
• Marginal propensity to save (MPS): The change in savings that results from a change in income.
• Marginal revenue product of labor: The additional revenue that is generated by one more unit of labor.
• Marginal tax rate: The tax rate that applies to the last dollar of income earned.
• Marginal utility: The additional satisfaction or benefit that is derived from consuming one more unit of a good or service.
• Market abuse: The manipulation of a market or the exploitation of inside information.
• Market analysis: The analysis of market trends and conditions to make investment decisions.
• Market capitalization ratio: A ratio that compares a company's market capitalization to its book value.
• Market concentration: The degree to which a market is dominated by a few large companies.
• Market efficiency theory: The theory that markets are efficient and that prices reflect all available information.
• Market failure: A situation in which a market fails to allocate resources efficiently.
• Market forces: The forces of supply and demand that determine prices in a market.
• Market index: A statistical measure of the performance of a market or a segment of a market.
• Market maker: A company or individual that provides liquidity to a market by buying and selling securities.
• Market microstructure: The study of the structure and functioning of markets.
• Market model: A statistical model that is used to estimate the relationship between a dependent variable and one or more independent variables.
• Market order: An order to buy or sell a security at the current market price.
• Market portfolio: A portfolio that includes all of the securities in a market.
• Market power: The ability of a company to influence the price of a product or service.
• Market price mechanism: The mechanism by which prices are determined in a market.
• Market risk management: The management of the risks associated with market fluctuations.
• Market segmentation: The division of a market into segments based on demographic or other characteristics.
• Market share: The percentage of a market that is accounted for by a particular company or product.
• Market structure: The organization and characteristics of a market.
• Market system: A system in which markets are used to allocate resources.
• Market timing: The attempt to time the purchase or sale of a security to coincide with market fluctuations.
• Market value added (MVA): A measure of the value that is added by a company's management.
• Mark-to-market accounting: A method of accounting that values securities or assets at their current market price.
• Mark-to-market valuation: The valuation of a security or asset at its current market price.
• Mark-to-model: A method of valuation that uses a model to estimate the value of a security or asset.
• Master file: A file that contains all of the information about a company's customers, vendors, or employees.
• Material control: The control of materials and supplies to ensure that they are used efficiently and effectively.
• Material handling: The movement and storage of materials and supplies.
• Material requisition: A request for materials or supplies.
• Material weakness in internal control: A weakness in a company's internal controls that could have a material impact on its financial statements.
• Maturity mismatch: A situation in which the maturity of a company's assets and liabilities do not match.
• Maximum allowable cost: The maximum amount that a company is allowed to spend on a particular item or project.
• Maximum dividend payout ratio: The maximum percentage of earnings that a company can pay out as dividends.
• Maximum tax rate: The highest tax rate that applies to a company or individual.
• Mean absolute percentage error (MAPE): A measure of the average absolute percentage error of a forecast.
• Mean squared error (MSE): A measure of the average squared error of a forecast.
• Measurement error: An error that occurs when a measurement is not accurate.
• Median absolute deviation (MAD): A measure of the median absolute deviation of a set of numbers.
• Median absolute percentage error (MAPE): A measure of the median absolute percentage error of a forecast.
• Merger and acquisition accounting: The accounting for mergers and acquisitions.
• Merger arbitrage: The strategy of buying and selling securities in connection with a merger or acquisition.
• Merger premium: The premium that is paid by one company to acquire another company.
• Method of accounting change: A change in a company's method of accounting.
• Method of depreciation: A method of allocating the cost of an asset over its useful life.
• Micro-accounting: The study of the behavior of individual economic units, such as households and firms.
• Microfinance institution: An institution that provides financial services to low-income individuals or small businesses.
• Mid-cap stock: A stock with a market capitalization that is between that of a small-cap and large-cap stock.
• Mid-term note: A debt instrument with a maturity of between 2 and 10 years.
• Minority interest in consolidated financial statements: The interest of a minority shareholder in a consolidated financial statement.
• Minority shareholder rights: The rights of a minority shareholder in a company.
• Mixed economy: An economy that combines elements of capitalism and socialism.
• Mixed model: A statistical model that combines different types of data or variables.
• Modified accelerated cost recovery system (MACRS): A method of depreciation that allows for accelerated depreciation of certain assets.
• Modified internal rate of return (MIRR): A measure of the return on investment that takes into account the cost of capital.
• Monetary authority: The authority responsible for monetary policy in a country.
• Monetary base: The total amount of money in circulation in an economy.
• Monetary policy: The actions of a central bank to control the money supply and interest rates.
• Monetary policy committee: A committee that sets monetary policy for a country.
• Monetary policy transmission mechanism: The mechanism by which monetary policy affects the economy.
• Monetary union: A union of countries that use a single currency.
• Money creation: The process by which money is created in an economy.
• Money demand: The demand for money in an economy.
• Money laundering: The act of concealing the source of money obtained through illicit means.
• Money laundering control: The control of money laundering activities.
• Money market fund: A fund that invests in low-risk, short-term debt securities.
• Money market instrument: A financial instrument that is traded in the money market.
• Money multiplier: The ratio of the money supply to the monetary base.
• Money supply: The total amount of money in circulation in an economy.
• Money supply growth rate: The rate at which the money supply is growing.
• Monitoring: The act of observing and supervising a process or system.
• Monopoly: A market structure in which a single company supplies the entire market.
• Monopsony: A market structure in which a single company buys the entire market.
• Moral hazard: The risk that a party will take on more risk than they would normally take on because they are protected from the consequences of their actions.
• Most favored nation (MFN): A country that is granted the most favorable trade terms by another country.
• Most recent transaction: The most recent transaction in a company's accounting records.
• Moving average: A statistical measure of the average value of a set of numbers over time.
• Moving average convergence divergence (MACD): A technical indicator that shows the difference between two moving averages.
• Multi-class stock: A stock that has multiple classes of shares with different voting rights.
• Multi-currency accounting: The accounting for transactions in multiple currencies.
• Multi-dimensional accounting: The accounting for multiple dimensions of a company's performance.
• Multi-level marketing: A marketing strategy in which a company's products or services are sold through a network of independent distributors.
• Multi-national corporation (MNC): A company that operates in multiple countries.
• Multi-period budget: A budget that covers multiple periods.
• Multi-step income statement: An income statement that shows multiple levels of profitability.
• Municipal accounting: The accounting for municipal activities.
• Municipal bond: A bond issued by a municipality to finance its activities.
• Municipal finance: The financing of municipal activities through bonds and other debt instruments.
• Mutual fund: A fund that pools money from multiple investors to invest in a variety of assets.
• Mutual fund fees: The fees charged by a mutual fund to its investors.