Definitions Flashcards
What is a creditor?
person to whom is owed money.
Define the term bankrupcy.
Bankruptcy is a declaration that a business, or individual is unable to pay his/her debts. It can only occur in sole trader or partnership based businesses.
What is market analysis?
Involves collecting, summarising and analysing information about the state of the market, customers, the threats and opportunities that the market presents, and any advantages or disadvantages that the business is likely to have over its competitors.
What is a competitive salary?
Competitive salarysimply means that thesalarythey’ll offer will be equal to or more than the industry standard for similar jobs in the same geographical area.
What is the corporate code of conduct?
A set of ethical standards for managers and employees to abide by.
What is strategic planning?
Planning for the following three to five years. This level of planning will assist in determining where in the market the business wants to be, and what the business wants to achieve in relation to its competitors.
What is market segmentation?
Occurs when the total market is subdivided into groups of people who share one or more common characteristic.
What is tactical planning?
Flexible, adaptable planning, usually over one to two years, that assists in implementing the strategic plan.
What is the difference between gross profit and net profit?
Thedifference between gross profit and net profitis when you subtract expenses.Gross profitis your business’s revenue minus the cost of goods sold. Net profitis your business’s revenue after subtracting alloperating, interest, and tax expenses, in addition to deducting your COGS.
What is benchmarking?
Benchmarkingis the practice of comparingbusinessprocesses and performance metrics to industry bests.
What is working capital?
The funds available for the short-term financial commitments of a business.
What is net working capital?
The difference between current assets and current liabilities. It represents those funds that are needed for the day-to-day operations of a business to produce profits and provide cash for short-term liquidity.
What are payables?
Sums of money owed by the business to other businesses from whom it has purchased goods and services. Payables are recorded as accounts payable.
What is the spot exchange rate?
The value of one currency in another currency on a particular day.
What is drip pricing?
This means that a business advertises one price but in the process of a customer purchasing the service numerous additional charges and costs are added.
