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a business owned and run by a single individual
sole proprietorship
a report showing a business’s sales, expenses, net income, and cash flows for a period of time, such as three months or a year
income statement
works in a businesslike way to promote the collective interests of its members rather than to seek financial gain for its owners
nonprofit organization
a stock of finished goods and parts in reserve—to satisfy customers or to keep production flowing smoothly
inventory
a government document that gives permission to create a corporation
charter
a business that is jointly owned by two or more persons
partnership
a noncash charge the firm takes for the general wear and tear on its capital goods.
depreciation
nonprofit service cooperative that accepts deposits, makes loans, and provides other financial services
credit union
all partners are equally responsible for management and debts
general partnership
form of partnership where one or more partners are not active in the daily running of the business, and whose liability for the partnership's debt is restricted to the amount invested in the business
limited partnership
a form of business organization recognized by law as a separate legal entity with all the rights of an individual
corporation
when companies involved in different stages of manufacturing, marketing, or sales join together
vertical merger
when it negotiates with management over issues such as pay, working hours, health-care coverage, vacations, and other job-related matters
collective bargaining
a form of corporate ownership giving one vote per share for stockholders
common stock
a check that transfers a portion of the corporate earnings
dividend
a temporary business investment that involves renting or leasing another firm’s successful business model
franchise
a firm that typically has at least four businesses, each making unrelated products, none of which are responsible for a majority of its sales
conglomerate
What are TWO of the THREE types of Cooperatives?
1.) consumer cooperative
2.) service cooperative
3.) producer cooperative
a corporation that has manufacturing or service operations in a number of different countries
multinational
What is ONE way to grow a business?
reinvestment
mergers
conglomerates
What is an advantage AND disadvantage of a corporation?
Adv.: 1.) ease of raising financial capital 2.)provides limited liability for its owners 3.) Board of directors can hire professional managers to run the firm 4.) unlimited life 5.) Ease of transferring ownership of the corporation
Dis.: 1.) Double taxation 2.) Difficulty & expense of getting a charter 3.) its owners, the shareholders, have little voice in how the business is run 4.) subject to more government regulations than other forms of business
What are TWO reasons for merging?
1.) faster growth
2.) synergy
3.) economies of scale
4.) diversification
5.) elimination of rivals
6.) change or lose corporate identity
What is ONE example from the book of indirect role of government?
1.) Antitrust laws
2.) College Scholarships
3.) Social Security payments
like to fund the start-ups of family, friends, or others whose business ideas have potential, but could not otherwise obtain enough seed money
angel investors
What is ONE example from the book of direct role of government?
1.) Tennessee Valley Authority (TVA)
2.) Federal Deposit Insurance Corporation (FDIC)
3.) U.S. Postal Service (USPS)