Finance and Accounts
What is a mortgage?
A low interest loan specifically for land and property
What are the four key sectors?
Primary, Secondary, Tertiary, Quaternary
State what is meant by the term business plan
A business plan is a document that provides details of proposals when reaching its aims and objectives
What are the four key concepts?
Creativity, Ethics, Sustainability, Change
True or False? Mission and Vision statements are the same thing?
False! Completely different
What are the two types of costs and explain what they are
Fixed and variable costs
Fixed: The costs that stay the same (rent)
Variable: The costs that change and vary (cost of making the product (packaging)
Why might a business use external growth to expand?
Possible Answers:
- Attract customers from new or existing markets
- Reduces the effect on competition
- It's very rapid
What does STEEPLE stand for in STEEPLE Analysis
Social, Technological, Economic, Ethical, Political, Legal, Environmental
True or False? Only one person can be ethical
False! A group of people can also be ethical
What is meant by a vision statement?
A vision statement is where it describes what the business aspires/wants to be doing in the future. Without one you are aiming for a lack of motivation
What is the difference between capital expenditure and revenue expenditure?
Capital Expenditure - Finance that is spent on maintaining fixed assets
Revenue Expenditure - Short-term expenses used in a current period or within one year
What are three examples of external growth?
1) Labour takeovers
2) Joint ventures
3) Franchising
The Business Cycle links to what word from the acronym STEEPLE?
Economic
State what is meant by the term ethics
Ethics are that governed by the behaviour of a person or a group of people. When making decisions they can influence the way business conducts itself.
Define the term sales revenue
Sales Revenue is the value of the products that the business has managed to sell from a set period of time
What are all the headings needed in a balance sheet?
Title of business with the date, Non-current assets, Total non-current assets, Current assets, Total assets, Non-current liabilities, Current liabilities, Total liabilities, Equity (total assets-total liabilities)
Why might a business stay small?
The owners of businesses would have extra costs added on to the ones they pay already as they can be associated to growing or operating on a large scale.
Why might a business use SWOT Analysis?
It can help identify areas of where your business is doing well. This is very useful because it gives you a competitive advantage against other businesses.
How can a business become sustainable?
To be sustainable you can conserve raw materials or find ways that don't ruin the planet to produce or discover new resources
Vision or Mission statement?
A statement that sets out a purpose for an organisational purpose to corporate values
What is meant by a fiscal year?
A set period that is used by governments and businesses that support for financial planning to report purposes
What are NGOs?
They are non-governmental organisations
Identify one advantage and one disadvantage of SWOT Analysis
Possible advantages:
Helps managers give a better understanding of the business's position in the market
Can facilitate strategic thinking
Possible disadvantages:
Doesn't guarantee success
Might contain errors
What can the concepts of Business Management teach us?
They provide focus to develop knowledge and understanding instead of factual content
Is a mission statement short or long term?
Short term