Chapter 6
This diagram illustrates a company's structure and reporting relationships.
What is an organization chart?
This term refers to the total amount of money a business earns in a given period before expenses are deducted.
What is revenue?
This process manages resources to achieve goals.
What is management?
This function involves planning, organizing, leading, and controlling resources to achieve goals.
What is management?
This concept says that money invested today grows over time due to interest or returns.
What is the time value of money?
The two key parts of organizational structure are specialization and grouping.
What is departmentalization?
The process of determining the needs and wants of potential buyers and then providing goods and services to meet those needs is called this.
What is marketing?
This leadership style involves decisions without consulting subordinates.
What is autocratic leadership?
This financial statement shows a company’s revenues, expenses, and profits over a specific period.
What is an income statement?
This stock exchange, one of the largest in the world, is located on Wall Street.
What is the New York Stock Exchange?
In a decentralized structure, decision-making authority is pushed to these management levels.
What are lower levels of management?
This financial statement provides a snapshot of a company's financial position at a specific point in time.
What is a balance sheet?
This motivation theory suggests that human needs must be met in a specific order.
What is Maslow’s hierarchy of needs?
A strategy to differentiate products from competitors by highlighting unique features and benefits.
What is differentiation?
The Rule of 72 gives the number of years for an investment to double by dividing 72 by this rate.
What is the annual interest rate?
This structure merges functional and divisional elements with dual reporting.
What is a matrix structure?
This ratio is used to measure a company's ability to meet its short-term obligations using its most liquid assets.
What is the quick ratio (acid-test ratio)?
It’s a company's ability to attract talent through benefits and growth opportunities.
What is employee retention?
This term describes the practice of producing goods using fewer resources.
What is lean manufacturing?
You get higher risks for higher returns with this type of mutual fund.
What is an aggressive growth fund?
A person within a company who acts like an entrepreneur, driving innovation and new ideas.
What is an intrapreneur?
This principle records revenues and expenses when incurred, not when cash moves.
What is the accrual accounting principle?
This model assumes managers will make logical choices that maximize the organization’s interests.
What is the rational decision-making model?
It's how accountants ensure a company's financial reports really represent its operations.
What is an audit?
This agency regulates stock markets and ensures transparency in securities trading.
What is the Securities and Exchange Commission?