Business and ID Business Flashcards
Chapter 10 – Business Requirements
- Accounts payable: Amount owed to a creditor.
- Accounts receivable: Amount owed to a business from clients.
- Balance sheet: Accounting document that illustrates the assets, liabilities, and owner’s equity (net worth) of a business for a given period.
- Business plan: Professional document describing the major considerations associated with starting or expanding a business, such as defining the business, determining the market, managing the business, and understanding the financials. Created and reviewed over the course of the life of the business.
- Break-even analysis: Point at which a businesses’ expenses and income are equal: no profits or losses.
- Current asset/liquid asset: Tangible item that is easily accessed, such as cash or money in savings or checking account.
- Depreciable asset: Tangible item that decreases in value over time, such as phone, computer, car, equipment.
- Deductible: Amount an owner must pay when collecting on an insurance policy.
- Difference between Gross vs. Net (typically related to profit or income):
- Gross: Total amount before any deductions, taxes, or expenses.
- Net: Amount remaining after deductions, taxes, or expenses. Actual take home
- Gross income (gross profit): The amount after subtracting variable costs from the sales revenue (Sales – Variable costs = Gross profit).
- Net income (net profit): Amount calculated by subtracting the gross profit from a businesses’ fixed costs (Gross profit – Fixed costs = Net profit)
- Variable cost: Amounts associated with the cost of a sale, such as fees paid for a consultant on a project.
- Fixed cost/overhead: Business expenses that do not vary month-by- month, such as rent and insurance.
- Liability: state of being responsible for something, especially by law. Responsibilities associated with debts, actions, and decisions associated with a business.
Chapter 11 – Operating and managing a green ID Business
- Soren Rose’s
- Legacy goal: creating something that will be used for a long time
- Use materials that will outlive ourselves
- Creating solutions that will be kept and not remodeled (avoid trends)
- Mike Holland, Foster & Partner’s
- Discussion of Life Cycle Analysis of the chair they created
- International EPD system- Environmental Product Declaration (EPD) system
- standardized method for quantifying and communicating the environmental impact of a product throughout its life cycle.
- It provides transparency and helps in comparing the environmental performance of different products to help arrive at a solution.
- Regarding the above mentioned chair, what was a significant part of the carbon footprint?
- Man-made upholstery and cushion foam
- Up to 25% of a building’s embodied carbon is related to the interior fit out.
- Q&A: Mike Holland
- Green washing- deceptive claim that a product or service is green
- Definition of green is smaller (ex. Doesn’t account for how a product is created, transported, or how the company operates)
Chapter 12 – Business Policies & Operations
- Revenue: income, money a business receives for services and products
- Expenses: costs associated with conducting a business, such as rent, utilities, salaries, travel
- Strategic plan
- Internal management document three purposes
- (1) assess the business’ current situation
- (2) determine the vision and direction of the business
- (3) identify the best approaches to successfully reach its goals
Chapter 14 – Managing, Growing, and Leading a Profitable ID Business
- Employment-at-will doctrine: Principle of law declaring that unless there is a written contract, employees can leave a place of employment for any or no reason and employers can terminate an employee for any or no reason
- Independent contractor: (Different than a W-2 employee) According to the IRS, a person hired by an employer that is not defined under common law or under statues for certain situations. Difference is that employers do not generally have to withhold or pay any taxes on payments to independent contractors
- Fed MED/EE (has to do with how Medicare is fianced)
- mandatory tax of 1.45\% based on taxable gross earnings
- your employer contributes 1.45\% also.
- Everyone has to pay this, employer pays some as well
- There are additional taxes if you earn more than 200,000.
- Most people claim Medicare benefits when they approach age 65
- Fed OSADI/EE aka Old-Age, Survivors and Disability Insurance tax (Social Security)
- It’s a 6.2\% deduction from your paycheck.
- This is also shared between employers and employees,
- so self-employed pay the whole tax themselves.
- You can continue working while you receive social security benefits.
- Being self-employed or an independent contractor requires that you pay more taxes, as there’s no employer to do it.