BUISNESS EXAM 1

Profit: Earned when a companies revenue is greater than its expenses

Revenue: The money a company brings in

Expenses: Money a company pays out

Goods: Physical Products a buisness sells

Services: intangible product that is bought or sold

Capital: investment in forms of money, equipment, supplies, and other tangible things of value

OffShoring: Buisnesses relocate production oversees to save money

Globalization: movement towards a more interconnected world economy

Advantages of Globalization

  • economic growth

  • less global conflict

Disadvantages of Globalization:

  • increased competition

  • some countries grow more than others

  • bad for environment

B2B: Business to Buisness

B2C: Business to Comsumer

C2C: Consumer to Comsumer

Sole Proprietorship: businesses that are owned by a single individual

Advantages of Sole Proprietorship:

  • Easy to Create

  • more money to owner

  • no specfic paperwork

Disadvantages of Sole Proprietorship:

  • exposed to personal liability

  • takes lots of personal time away

Unlimited Liability: Personal assests can be used to pay balance if buisness assets aren’t enough to pay its debt

Partnership: two or more entities share ownership of buisness

Advantages of Partnerships:

  • your partner can have different strengths to help

  • More personal time

Disadvantages of Partnerships:

  • wrong partners can be problematic

General Partnership: Default arrangement for a partnership, full owners of buisness

Limited Partnership: at least one partner controls a buisness’ operations and is persnally liable

Corporation: specific forms of business organization that is a legal entity seperate from owners

C Corporation: Corporations taxed seperate from its owners

Shareholders: Ownership interested in the company

S Corporation: corporation that has elected to be taxed under a special section of the interal revenue code

Limited Liability Company (LLC): the owner has limited personal liabilty for the debts and actions of the company

Advantages of Corporations:

  • limited liabilty

  • corporations have almost the same rights as people

  • easier to sell

  • easier to raise money if larger

Disadvantages of Corporations:

  • harder to start

  • double taxation

Mergers: when 2 companies agree to combine and form a new company

Horizontal Merger: 2 companies sell the same products and are in competition with each other

Vertical Merger: 2 companies have a customer relationship

Product extension merger: 2 companies selling different but related products in the same market

Theory X: people are not motivated, avoid responsibilty

Theory Y: people are motivated, problem solvers, want more responsibilty

Stages of Team Development:

  1. Forming

  2. Storming

  3. Norming

  4. Perfoming

  5. Adjourning

Forming: forming relationships and creating your team

Storming: teammates start to show their differences, strengths and weaknesses

Norming: teammates learn how to work with each others differences and find their spot in the team

Performing: team starts to make good progress

Adjourning: team comes to an end

CEO: Chief Executive Officer

CFO: Chief Financial Officer

COO: Chief Operating Officer