#1AOS1 business foundations SAC 1

Question 1

types of business structure;

Answer 1

• social enterprise
• public limited companies
• private listed companies
• sole trader
• partnerships
• government business enterprise

Question 2

Type of business structure
social enterprise definition
advantages and disadvantages

Answer 2

A type of business structure that exists primarily to fulfil a vision that benefits the community or social need rather then shareholders

avantages;
meet a social need can encourage community support- increase profit
improve moral within business (employees value work they do)

disadvantages;
difficult to obtain finance to begin
difficult to focus on financial and social objectives

Question 3

Type of business structure
Government Business Enterprise (GBE) definition
advantages and disadvantages

Answer 3

A type of business structure that is owned and operated by the government, with the aims to make profit along with carrying out government polices. owned by the government, and controlled by a board of directors

advantages;

• benefits community, as may invest in an area that private sector may hesitate benefiting community
• provide healthy competition to private sectors- decrease price increase goods

disadvantages;
- strategic direction can change if government does
- came political interferences
-

Question 4

Type of business structure
Listed Company
advantages and disadvantages

Answer 4

A type of business structure that is Publicly listed on the exchange for members of the public to freely by shares. The business owner has limited liability.

advantages;

• limited liability
• all public has opportunity to buy shares after 18 yrs

disadvantages;
highly complex, time consuming to establish to list on public exchange
- loss control, don’t have to approve shares or % of shares

Question 5

Type of business structure
limited company
advantages and disadvantages

Answer 5

A type of business structure that is privately owned by 2-50 shareholders, that are not freely available to the public instead have to have permission from other shareholders and be invited into the shares.

advantages- limited liability

• life of company can live longer then directors
• attract more capital cause of shares then sole traders or partnerships

disadvantages- more complex and expensive to setup

• shares cannot be traded feely (not as easy to attract finance)
• more reporting required to government and owners

Question 6

Type of business structure
partnership
definition
and advantages and disadvantages

Answer 6

A type of business structure that is owned by 2-20 people. as Partners share the same entity, all members have unlimited liability, meaning owner responsible for all the businesses debts, if business unable to pay its owner is liable.

advantages; workload shared
- different skills and experience brought to business

disadvantages; potential for disagreements over key decisions

• liability for debts incurred by other parteners
• shared profits

Question 7

Type of business structure
soletrader definition
and advantages and disadvantages

Answer 7

A type of business structure that is owned by one person. that is responsible for all aspects of the business including financial and operational side (unlimited liability) 
advantages 
- simple and inexpensive to set up 
- complete control 
- keeps all net profits 
 disadvantages
- unlimited liability 
- burden on managing the entire business

Question 8

objective

Answer 8

an objective is desired goal, outcome or specific result that a business intends to achive

Question 9

5 types of objectives

Answer 9

• to make a profit
• increase market share
• fulfil a market need
• fulfil a social need
• meet shareholders expectations

Question 10

to make a profit (objective)

how

Answer 10

amount of money left over after expenses have been deducted from revenue. Means able to survive and grow
- increase sales and revenue or minimising their spending

Question 11

increase market share (objective)

how

Answer 11

the proportion of the total sales the business has in an industry for a particular goof or service. Represented as a percentage, showing customers choosing their business over another.
- strengthen customer relationships

Question 12

fulfil a market need (objective)

Answer 12

market is a specific group have similar characteristics that businesses focusing selling goods and services need to think about peoples needs and wants.
-market research to find what needs and wants of different consumer groups are and the business aims to satisfy their needs and wants

Question 13

fulfil a social need (objective)

Answer 13

Goods/services sold to generate money to positively improve the community lives/environment

Question 14

meet shareholders expectations (objective)

Answer 14

those that own the business, expect return on their investment through
capital gains- value of business increase (shares increase too)
dividends- their share in the business profits

Question 15

stake holders (objective)

Answer 15

groups and individuals who have some form of interest in the business and after affected by activities. stakeholders can exists in the internal and external environments of a business

Question 16

types of stake holders (7)

Answer 16

• owners/shareholders
• employees
• managment
• customers
• suppliers
• competitors
• community

Question 17

owner/sharholders (stakeholders)

• definition
• their interests
• csr

Answer 17

• invest money into the business, to own a share of the business.
• interest is wanting return on their investment through capital gains, improve profits (dividends), increase share prices
• csr; managers being honest with current and potential shareholders regarding future for the business so they can make wise investment decision

Question 18

managers (stakeholders)

• definition
• their interests
• csr

Answer 18

• employeed by the business to over see employees and make decisions for the business, to ensure business strategy is carried out so the business objectives are achieved. can be one or more levels of management depending on size of business
• their interest involved in decision making, objectives being met and take correction action if they are not. make sure employees are kept working hard and completing set tasks
• csr; fair pay, positive work conditions

Question 19

Employees (stakeholders)

• definition
• their interests
• csr

Answer 19

• people that work in business in exchange remuneration. the ones that complete activities to achieve business objectives.
• their interests fair pay, good working conditions, ongoing employment
• csr; ongoing training, career advancement, fairway and good working conditions

Question 20

customers (stakeholders)

• definition
• their interests
• csr

Answer 20

• shoes who purchase goods/ services from business, who must meet their expectations in oder to remain competitive
• their interests; goof quality products at a fair price
  csr; ensure high quality products (value for money)

Question 21

suppliers (stakeholders)

• definition
• their interests
• csr

Answer 21

• those that provide a business with materials and other resources. important for business to develop strong relationship with suppliers
• interests; strong/ long term relationship meaning arrive on time and potentially lower costs, paid on time
  csr; local suppliers, seeking ethical suppliers (fair trade)

Question 22

competitors (stakeholders)

• definition
• their interests
• csr

Answer 22

• rival business that sell similar product in the same market. Business need to monitor their competitors actions (what selling and prices) so they can respond and remain competitive
• their interests are healthy and fair competition, ensure gain competitive edge over other business, differentiate their product or service, compare and evaluate their performance against others
  csr; fair competition, no harm in advertising

Question 23

Community (shareholders)

• definition
• their interests
• csr

Answer 23

• have a responsiblity to the community they run in (those living in same place business does) and sell to look to benefit the community
• their interests; business give ack to the community, employment opportunities, minimise their impact on environment
• csr; ethical waste disposal (minimise impact on community)

Question 24

capital gain

Answer 24

profit from investment

Question 25

dividends

Answer 25

Money paid to shareholders, out of its profits

Question 26

remuneration

Answer 26

money paid for work or a service

Question 27

money paid for work or a service (whats this called plus spelling)

Answer 27

remuneration

Question 28

ares of business management responsibility (5)

Answer 28

- operations - finace - marketings/sales - technological - human resources

Question 29

operations - definition - activities involved - how business objectives met

Answer 29

-responsible for maintaining the process of goods and services (transporting quality inputs into out puts in an effect and efficient way to reach customers satisfaction) -ordering, sourcing stock. ensure meets customer expectations, redesigning the sequence of production to be the best - quality outputs= revenue as well as customers satisfaction meaning objectives around sales are met. (increase sale and market share, productivity and profit)

Question 30

finance - definition - activities involved - how business objectives met

Answer 30

- monetary aspects of the business, receiving and spending money (surplus= in and out money) as well as budgeting for the business. - budgeting, financial planning, day to day payments and receipts - ensure revenue higher then expenses increases profit to be able to buy supply to meet customer satisfaction as well as shareholders because of dividends

Question 31

human resources - definition - activities involved - how business objectives met

Answer 31

- the area that managers the relationships between the employees and the business - activities involve; recruitment, selection training, motivating, ultimate termination - skilled employees , motivated, increase productivity fulfils a market need

Question 32

sales and marketing - definition - activities involved - how business objectives met

Answer 32

- responsible for promoting the business and its products with their end consumers. - actives involved; determining product features, pricing, promotion, distribution, customer services and after sales support - business objectives; customer sales increase profit, increasing shareholders dividends meeting shareholders expectations

Question 33

technology - definition - activities involved - how business objectives met

Answer 33

-responsible with providing employees and customers with user friendly technology and assistance for individuals have technical problems with electronics devices. -activites include; computer problems, website crashes, phones fixed business objectives; keeping employees productive, customer satisfaction is met increasing sales and profit and market share increases

Question 34

corporate social responsibility

Answer 34

CSR is used by a business when making decisions, business need to ensure there decisions are both ethical and socially responsible. And there is no negative effect on the environment or public.