fbe final

fernhaber's business final

the bottom line of an income statement shows the firm’s…..

net income or loss

positive difference between gross profit and total expenses

net income

positive difference between sales and cost of goods sold

gross margin

Last year, Rebecca’s bookstore had $1 million in sales. She spent $290, 000 to buy the books that she sold and $300,000 in operating expenses. What was Rebecca’s net profit margin?

41%

if a firm has a debt to owners’ equity ratio of .54 of 54% we can conclude that

its total liabilities are less than its owners equity

its _______ ratio shows how efficiently a company sells its average stock of goods on hand in one year

inventory turnover

______ is another word for revenues

profit

when performing the management _______ function, managers measure the result of operations and compare them with the results they had laid out in their original goals

controlling

when Darius noted that the amount of electricity used in the factory was 20% higher than he expected for the year, he was involved in _______

controlling

the job of the _______ consists of all the activities involved in transforming a product idea into a finished product

operations manager

Luciana runs an ice cream shop. she is determining how many employees should work next week and at what times. She is performing which management function?

organizing

in performing the _____ function, managers set goals and determine the best way to achieve them

planning

the process of providing focus for employees and motiviating them to achieve organiziational goals

directing

an individual who identifies a business opportunity and assumes the risk of creating and running a business to take advantage of it

entrepreneur

the activities needed to operate a business can be divided into a number of

functional areas

a system for measuring and summarizing business activities, interpreting financial information, and communicating results to management and other decision makers

accounting

involves planning for, obtaining, and managing a companies funds

finance

flow that begins with the purchase of raw materials and ends in the sale of a finished product to an end user

supply chain

because the government limits them by law, there are a few ______ in the US

monopolies

market in which many sellers supply differentiated products

oligopoly

market in which a few sellers supply a large portion of all the products sold in the marketplace

monopolistic competition

if economic indicators suggest that we are in a recession, what might the government do?

when the country is in a recession, the appropriate policy us to increase spending, reduce taxes, or both. Such expansionary actions will put more money in the hands of businesses and consumers, encourage businesses to expand and consumers to buy more goods and services

______, which lists the stocks of 500 large US companies, is a broad measure of stock performance

standard and poor’s composite index

the stocks of the largest, most prestigious corporations in the world are traded on _____

new york stock exchange

what enforces consumer protection laws

federal trade commission

what oversees the labeling of food products

food and drug administration

what enforces laws by protecting consumers from the risk of product related injury

consumer product safety commission

the monthly fee that a franchisee must pay to keep the companies trade name is called a _____

royalty fee

teresa santiago and here husband clarke, parents of two children, opened a buffet restaurant last year. They’ve been so successful with their family-style atmosphere that some investor friends have offered funding to expand into two additional locations. The investors also want to consider opening several more restaurants each year. After thinking it over, the Santiagos decided to stick with one restaurant and add catering services - a move that should provide them with a satisfactory income. The Santiagos’ business is a good example of a *________*

lifestyle business

corporations account for ___ __percent of all US businesses but generate almost ______ percent of the revenues__

18/82

RJR Nabisco (a U.S. company) allows a company in Singapore to use its brand name and recipe to produce and sell one of its products- Planters Nuts. In return, RJR Nabisco receives a royalty fee. This type of international arrangement is called

licensing

most common and riskiest option to starting a business. You start with a clean slate and build the business the way you want. It’s up to you to develop your customer base and build your reputatation

starting from scrath

this option to starting a business is not as risky as starting a business from scratch, but it has some drawbacks. You’ll already have a proven product; current customers, active suppliers, a known location, and trained employees. It’s hard to determine and how much to pay for a business perhaps the current owners have disappointed customers; maybe the location isn’t as good as it used to be.

buying an existing business

number one key to starting a business

fulfilling a need

Executive summary

description of proposed business

industry analysis

mission statement and core values

management plan

goods, services, and the production process

marketing

global issues

financial plan

appendices

components of a business plan

executive summary

one to three page overview

brief description of the company that answers such questions as what your proposed company will do, what goods or services it will provide, and who its main customers will be

description of proposed business

short introduction to the industry in which you propose to operate

industry analysis

mission statement and core values

fundamental beliefs about what is important and appropriate in conducting company activities

management plan

information about management team qualifications and responsibilities, and designation of your proposed legal form of organization

goods, services, and the production process

description of the goods and services that you’ll provide in the marketplace; explanation of how you plan to obtain or make your products or the process by which you’ll deliver your services

marketing

description of your plans in four related areas: target market, pricing, distribution, and promotion

global issues

description of your involvement if any, in international markets

financial plan

report on the cash you’ll need for start-up and initial operations, proposed funding sources, and means of repaying your debt

appendices

supplemental information that my be of interest to the reader

downward communication

flows from higher organizational levels to lower organization levels

upward communication

flowers from lower to higher organizational levels

lateral communication

flows across the organization, among personnel on the same level

entrepreneurs are generally considered to be ______ risk takers

moderate

goals include profitability and growth, focuses on new opportunities, owners are willing to take risks, and it is characterized by innovative products and practices

characteristics of entrepreneur

________ have independence, lifestyle advantages, financial rewards, learning opportunities, and creative freedom, and personal satisfaction

small business owners

by making Christmas decorations available the day after Thanksgiving, Holly’s holiday shop is offering customers what kind of utility?

time utility

______ utility provides value by having a product available in a convenient location

place utility

______ utility provides value by transferring a product’s ownership

ownership utility

_____ utility provides value by changing the composition of a product

form utility

in an effort to make its food healthier, McDonald’s changed the way it made its french fries. This is an example of

an improvement in an existing product

_____ the process of altering existing organizational structures to make a firm more competitive under changing conditions

restructuring

standardized products that have come off assembly lines are produced by a process known as _____

mass production

a ____ is a good or a service that is new to the company but has been sold by a competitor in the past

new-to-the-company product

an _____ is a new product developed as a variation of an already existing product

extension to an existing product line

a _____ is a good or a service that has not been available to consumers or manufactures in the past

new-to-the-market product

a company seeks a(n) _____ by registering the name of a product with the U.S. Parent Trade Office

trademark

grant of the exclusive right to produce or sell a product, process, or invention

patent

_____ pricing bases the selling price of a product on its cost plus a reasonable profit

cost-based

using ____ pricing, a company initially charges a low price, both to discourage competition and to grab a sizeable share of the market

penetration

pricing strategy in which a seller generates early profits by starting off charging the highest price that customers will pay

skimming pricing

pricing strategy that bases the price of a product on how much people are willing to pay for it

demand-based pricing

pricing strategy that determines how much to invest in a product by figuring out how much customers will pay and subtracting an amount for profit

target costing

practice of setting a price artificially high to foster the impression that is it a product of high quality

prestige pricing

practice of pricing products a few cents (or dollars) under an even number

odd-even pricing

once you’ve forecasted the demand for a product, you can calculate the ____ requirements of your production facility

capacity

collins computers arranges its computer assembly into teams working in a U-shaped formation so that they can share the work and some of the equipment. what type of production layout does collins computers use?

cellular layout

high-volume goods are produced in assembly-line fashion, a series of workstations at which already-made parts are assembled

production layout

_____ used to make large items (such as ships or buildings) that stay in one place while workers and equipment go to the product

fixed-position layout

______ groups together workers or departments that perform similar tasks. At each position, workers use specialized equipment to perform a particular step in the production process

process layout

management of inventory to ensure that a company has enough inventory to keep operations flowing smoothly but not so much that money is being wasted in holding it.

inventory control

the formal establishment of business operations on foreign soil, such as factories, sales offices, or branch stores, is called ____

foreign direct investment

setting up facilities in a foreign country that replace U.S. manufacturing facilities to produce goods that will be sent back to the United States for sale

offshoring

____ is a manufacturing strategy whereby a firm produces products outside of its own plant

outsourcing

Entree Specialites which produces food products and ships them to several independent buyers throughout Western Europe is in the ___ business

exporting

wholesaler or retailer who helps move products from their original source to the end user

intermediary

make raw materials to finish goods and deliver them directly to customers

operations supply chain

most financial statements are prepared by accountants except _____

marketing budgets

the _____ is an accounting system that reports the inventory of a firm

balance sheet

the _____ shows a firm’s revenues and expenses and whether it made a profit

income statement

the _____ reports the changes in owner’s equity that have occurred over a specified period of time

statement of owner’s equity

financial statement reporting on cash inflows and outflows resulting from operating, investing, and financing activities

statement on cash flows

commercial banks, savings banks, and credit unions are examples of?

depository institutions

finance companies, insurance companies, and brokerage firms

nondepository institutions

common financial institution in the US

commercial banks

_____ were originally set up to encourage personal saving and provide mortgages to local home buyers

savings bank

financial institution that provides services to only its members

credit union

nondeposit financial institutions that make loans from funds acquired by selling securities or borrowing from commercial banks

finance companies

nondeposit institution that collects premiums from policyholders for protection against losses and invests these funds

insurance companies

financial institutions that buy and sell stocks, bonds, and other investments for clients

brokerage firm

successful companies looking for additional capital might decide to go public, offering an initial sale of stock called an ______

initial public offering

financial institution that specialized in issuing securities

investment banking firms

in deciding to raise needed capital for her company through the sale of stock, LaTisha has opted for _____ financing

equity

____ are wealthy individuals willing to invest in start-up ventures that they believe will succeed

angel investors

____ are willing to invest larger sums of money, but want to cash out more quickly than angels

venture capitalists