Business Ownership
What are the three types of business ownership
Sole Trader, Partnership, Companies
Define production
This is the process of making or manufacturing items from raw materials
What is communication?
Communication refers to the process by which we create, transmit, and interpret ideas, facts, data, feelings and opinions,
Define commercial bank and automatic banking
Commercial Bank: They are a financial institution who do help out with loans and other stuff
Automatic Banking: The ability to access your bank account remotely
What is accounting?
A way to communicate the financial health of a business or an organization to any and all interested parties
What are the two types of company?
Unlimited Liability and Limited Liability
Define goods and services
Goods are items that are tangible, services refer to activities provided by other people.
What are the types of communication?
Formal and Informal
How long can we have cheques for?
6 months
Bookkeeping is the activity or occupation of keeping records of the financial affairs of a business.
What is one reason to start a business?
Income potential, to satisfy a demand, to create employment
What are the factors of production?
Land, Labour, Capital, Entrepreneurship
What method of communication is a letter or email?
Written
Give two types of cards and their meaning
Debit Card and Credit Card
Give the 5 simple accounting terms and their meaning
Assets - Resources or things of value owned by the company. Liability - Anything that is owing by the business to another person outside. Capital - The funds raised to support a particular business or project. Income / Revenue - The amount earned from a company's main activities such as selling merchandise or providing services. Expenses - An expense in accounting is the money spent or cost incurred in an effort for revenue.
Give 2 advantages and 2 disadvantages of a partnership
Advantages: More capital, more expertise, the risk of the business operation will be shared
Disadvantages: All partners are affected by the actions of another partner, slow decision making, high risk for partners with unlimited liability
Natural Resources is anything that people can use which comes from the natural environment. Man-Made resources is anything that people man has made.
What are the barriers affecting communication?
Language, Psychological, Physiological, Systematic
Who is a payee?
A payee is the person or company getting the cheque / to whom the cheque is to be made payable
Define the two types of assets
Current / Short Term Assets - Short Term Assets used up within the business in a year
Non-Current / Fixed Assets - Assets that are used for long term purposes
How many people can be in a partnership?
2-20
Give 3 examples of mineral deposits in the land factor
Bauxite, Oil, Iron, Gold, Diamonds, Rivers, Ponds, Lakes
Give and explain the elements of the communication process
What are 4 advantages of using a cheque
Safe and Trusted, Convenient, Post Dated, Customizable and personalized
Give the accounting equation
Assets = Equity + Liabilities
Equity / Capital = Assets - Liabilities
Liabilities = Assets - Capital
What is one advantage and one disadvantage of a Sole Trader?
Advantages: All profits are taken by owner. Consultations are not necessary for decision making. Legal requirements for start up are simple
Disadvantages: Working long hours. Limited capital. No liability meaning he might lose assets if the business goes bankrupt. Lack of expertise in areas of business.
What are renewable and non-renewable resources and give 2 examples of each
Renewable resources are replenished naturally over a short period of time, examples are water, wind, sunlight
Non Renewable Resources are available in limited supplies and take a while to get replenished. Examples are coal, oil and natural gas.
What is noise in the communication process?
Noise can affect the message at any point in the communication process. It relates to any distraction which may interfere with the message itself or the communication process as a whole
Give 5 parts of a cheque
Name / address, cheque number, payee, date of the cheque, amount of money in words, amount of money in numbers, name / address of bank, signature, note about cheque, bank account number, branch number and cheque number
Define the two types of liabilities
Current and Non-Current / Long term
Current - Liabilities to be paid within a year. Non-Current - Liabilities due to be paid over one year
List 2 sources of capital for each business ownership
Sole Trader: Loan and overdraft from banks, trade credit, personal savings, grants and loans from government
Partnership: Personal Savings, small business loans, additional partners
Company: Financial Institutions, government agencies, venture capital for investors, shares, franchising
List the 3 categories of workers and give 2 examples of each
Skilled / Professional - Teachers, Doctors, Nurses, Lawyers, Engineers, Architects. Semi-Skilled - Flight Attendant, Bartenders, Truck Drivers, Taxi Drivers. Unskilled - Farm labourers, cashiers, grocery clerks, cleaners and sweepers
Give the 4 methods of communication and one example of each one
Verbal / Oral, Written, Non-Verbal, Visual
State the 4 safety guidelines
Keep clean and tidy, Cheque management, Report immediately If lost, Check before issuing cheque
Give 4 source documents
Invoices, Receipts, Cheques, Deposit Slips, Debit Note, Credit Note
Give 3 forms a business structured as a company must submit
A Completed Form 1, A Completed Form 1A, A Completed Form 17, A Completed Form 20, Registration Fee
Explain the 4 factors of production
Land includes all natural resources found within the atmosphere. Labour includes human resources or workers. Capital includes all man made resources such as vehicles and machinery. Entrepreneurship is the creative decision-making, risk taking or starting an enterprise.
Language may act as a barrier if it is not fully understood by the receiver in a different language. Psychological is the state of the communicators will influence how the message is sent, received and perceived. Physiological will result from the receiver's physical state, eg: background noise. Systematic barriers exist in organization where there are inefficient or inappropriate information systems.
Payment Services, Financial Intermediary, Financial Services, Ancillary Services
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Give 3 users of accounting and their purpose of doing so
Owners / Investors, Employees, Lenders, Suppliers and other creditors, Customers, Government, The Public Local Community
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