Page 681 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

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capital gains tax The tax due on the sale of an asset (less its acquisition cost). Such assets that are
owned for more than a year are subject to long-term capital gains taxation; those held for a shorter
period of time are subject to short-term capital gains taxation. Historically, long-term rates have been
lower than short-term rates.
capital gains taxation The tax rates that apply to short-term and long-term capital gains.
capital intensive See capital-intensive organization.
capital-intensive organization Equipment rather than people dominates the lower levels of the
organization; the opposite of a people-intensive organization.
capitalist An individual who invests capital in a business with the objective of making a profitable
return on the investment.
capitalization Long-term debt plus equity securities for a company.
capitalization ratio See earnings price ratio.
capital loss The loss realized from selling an asset for an amount below its acquisition cost. The loss
is short term for assets owned 12 months or less and long term if owned for a longer period. Capital
losses can usually be used to offset capital gains.
capital market Long-term debt plus equity securities for all companies.
capital stock The amount of stock (common plus preferred) authorized by the organization’s
charter.
capital surplus The amount by which the fair market value of the company’s stock exceeds its
par value.
capitation A common charge per person.
CAPM See capital asset pricing model.
capped price stock option When fair market value of the stock reaches a stated price, the option
must be exercised, thereby limiting the amount of gain at time of exercise.
career acrophobia Fear of failing and falling from the corporate ladder of success.
career average pension plan See career earnings pension plan.
career crisis Belief that no future promotional opportunities exist. See early-career crisis, midcareer
crisis, late-career crisis, and postcareer crisis.
career earnings pension plan Annuity plan based on total earnings during employment with the
organization.
career restricted stock A lengthy period of restriction (e.g., until retirement) on the ability to sell
the stock. Also called career stock.
career service pension plan Annuity plan based on years of service with the organization.
career stock See career restricted stock.
carried interest Shares and/or options on stock of a new venture; could also mean a percentage of
the profits.
carrier The company that pays insurance benefits.
carryforward Unused monies from a previous period that are available for use in the
current period.
carryover See carryforward.
cars See company cars.
cartel An affiliation or organizations intent on controlling competition for products and services.
carved-out integration method See excess integration method.