1. What is a business? Flashcards
What is a mission statement?
qualitative description about the organisation- so stakeholders understand its intent
(aims, values, vision ect)
Corporate objectives
Define overall objectives of business driven by the mission statement
Drive functional objectives
What does SMART stand for?
Specific
Measurable
Accurate
Realistic
Time frame
What are functional objectives?
Detailed objectives of each department
driven by corporate
Why do we have objectives?
Measure success
Coordination of managers/employees
Gives focus and direction
Why is profit important? 6 reasons
Source of finance
Reward for taking risks
Not-for-profit
motivate employees
sign of financial stability
success indicator
rights of ordinary shares
voting
dividends
rewards of shareholders
dividend
capital growth/gain = increase value
share price
price of share dependent on supply and demand
market capitalisation
value of businesses total shares
share price x no of shares
what are variable and fixed costs?
variable change with output
fixed don’t change with output
total costs calc.
fixed + variable costs
