The Law Dictionary

Your Free Online Legal Dictionary • Featuring Black’s Law Dictionary, 2nd Ed.

Category: D

DEALER INCENTIVE

When a car manufacturer offers dealers a cost reduction to get them to buy from the factory. It is used on slowmoving stock after a goal is met.

DEBIT SPREAD

Any OPTION SPREAD that results in a net outflow of PREMIUM. See also CREDIT SPREAD.

DECEASED ACCOUNT

When a bank account is owned by a now dead person. It is frozen while it awaits for instructions from the executor. Issues about heirs and creditors are considered at this time.

DECISION THEORY

The way managers make decisions based on logic and math. It has three classes of decisions made under certainty, decisions under conflict, and decisions under uncertainty. Refer to game theory.

DEDUCTIBLE

The amount or percent of an insurance claim that the insured is responsible for and the company deducts for payment. It can be voluntary but is usually given to the insurer to

DEEMED SUBSTANTIATION

It tells deductibilty or travel expenses employees incur and are reimbursed for with a per diem allowance. Documentation is needed stating date, place, and purpose for the party.

DEFAULT SWAP

An OVERTHECOUNTER SWAP involving the exchange of deferred PREMIUM (often in the form of a floating rate CASH FLOW) for a lumpsum payment if an UNDERLYING reference credit DEFAULTS. The lumpsum payoff

DEFERRED INCOME TAX LIABILITY

More income tax on a statement over the taxed amount. It happens when book incomes is more than taxable income. It is liablity on balance sheet and is written off.

DEFICIENCY LETTER

1. an notice stating omisssions in official document to get rectification. 2. a letter sent to notify that a shortfall has occured and demand restitution.

DEFINITIZATION

The final agreement or contract about a decision. It can be about cost or the scope of a project.

DEGREE HOUR

The degrees fahrenheit the hourly average indoor temperature changes from the standard temperature. It is used for head and cooling estimation.

DELAYED CALL BOND

A bond not called for years and continues to generate income. Refer to callable bond.

DELIVERY OPTIONS

A series of selections that the seller of a FUTURES contract on a US BOND can make that can increase the value of the contract. The delivery options include the quality option

DEMAND AND SUPPLY

Forces needed for price in the free market system. It decides good prices and the price that can be gotten. It is self regulating and meets equilibrium without interference.

DEMAND NOTE

A note with a due date or that can be paid whenever demanded. It is not a mortgage.

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