what is a business?
what is a business?
an organisation that sells goods and services to customers
give 4 purposes of profit
reinvest into the business,attract investors,financial award for euntrepneurs,measure success
what is a mission
an aim that describes what the business is and why it exists
what is a mission statement
a statment that is created to inform and inspire customers
what is an objective
goals or target set to acheive the mission
what is a strategy
long term business plans put in place to acheive the objective
what do mission statements do
outline the big picture about what the businesses does
what is a supplier
a business that sells goods and services to olther businesses
what is the cost of production
the amount of money that is spent to produce a good or service
what is revenue
the value of income a business recieves in return for their goods or services
what are costs
money spent by the business in order to produce goods and services
what is the equation for profit
revenue-costs
what is cashflow
moeny coming in and out of a business
name two financial objectives for a business
profit maximisation,increase market share
name two non-finanical objectives for a business
increase customer satisfaction,environmentally-friendly
wht is a deed of partnership
legal contract to decide who did/ got what
what is a sole trader
an individual who has full ownership of a business
what is unlimited liability
owners are personally fully responsible for the businesses debts
what is limited liability
repaying debts only how big the initial investment was, no private possesions will need to be sold in order to repay a debt
what is a partnership
2 or more people that start up a business
what does an incorparation do for a business
creates a sepaerate legal identity of the business from the owner
which two businesses have unlimited liability
sole traderand partnership
which two business forms have limited liability
PLC and LTD
who gets the profits from sole trader
sole trader
who gets the profits from a partnership
parters % split depends on agreement in the deed of partnership
who gets the profits in limited companies
shareholders via dividends
how much paperwork is there to set up a sole trader
very little
how much paperwork is there to set up a partnership
deed of partnership
how much paperwork is there to set up limited companies
process of incorparation
is financial info published for a sole trader
no
is financial info published for a partnership
no
is financial info published for limited companies
yes
can PLC shares be sold on the stock exchange
yes
how can you buy shares in an LTD
via private arrangement
how much is the minimum capital required for an LTD
very little
how much is the minimum capital required for a PLC
50000
what is an ordinary share
a share that has equal rights to dividends and has one vote
what is a preference share
entitles the shareholder to a fixed dividends whos payments takes priority over ordinary share dividends
what is a non voting share
no voting rights
what is market capitalisation
a meaure of the value of a business
what is the market capitalisation formula
current share price x number of shares issued
what is a dividend
a payment to shareholder as a reward for their investment
where does dividend come from
the profits of a business
how often are dividends paid
annually
what is a co-operative
a business owned by its workers or customers
what is a non-profit organisation
businesses set up with no profit incentive
what is a charity
a business set up to generate revenue that is distrubuted to a good cause
what is the public sector
owned by the national or local govenments
what is the private sector
owend by indiviuals or businesses
what do shareholders do
provide share capital and vote on key issues
why do shareholders invest
receive dividends, sell a share to mke a profit, influence the diretion of the business
what is the size of the dividends influenced by
size of current shares, expectations about future profits, the companies dividends policy
what is short termism
profit hungry, and be at the expense of developing successful long term strategies