What term is used for someone who owes the business cash?

The term for someone who owes the business cash is "debtor." A debtor refers to an individual or entity that has borrowed money or received goods or services with the agreement to pay later. In the context of a business, when customers or clients have not yet paid for the products or services they received, they are considered debtors. This relationship creates an accounts receivable situation for the business, indicating that the business expects to receive cash in the future.

On the other hand, an investor provides funds to a business with the expectation of earning a return, while a creditor has lent money to the business and is owed money by the business itself. An equity holder represents someone who owns a share of the business and thus has a claim on its assets and earnings rather than owing money to the business. Understanding these distinctions is essential for grasping basic business finance concepts.