Entrepreneurship Vocab Flashcards
Acquisition
The purchase of a company by another, larger firm absorbs the smaller company into its operations.
Board of directors
A group of individuals elected by a firm’s shareholders and charged with overseeing, and taking legal responsibility for, the firm’s actions.
Chief Executive Officer (CEO)
The person responsible for the business’s overall performance.
Co-operative
A cooperative is an organization that is owned and controlled by the people to meet their common economic, social, and/or cultural needs and aspirations through a jointly-owned and democratically controlled business (enterprise). The people of the cooperative are those who use its products, supplies, and/or services. Profits are also often returned back to the members of the cooperative, however, cooperatives are often more focused on services for members than for investments.
Common stock
Shares whose owners usually have the last claim on the corporation’s assets (after creditors and owners of preferred stock) but who have voting rights in the firm.
Conglomerate merger
A merger of two firms in completely unrelated businesses.
Corporate governance
The relationship between shareholders, the board of directors, and other top managers in the corporation.
Divestiture
Occurs when a company sells part of its existing business operations to another company.
Employee stock ownership plan (ESOP):
When a corporation buys its stock with loaned funds and gives them to its employees. Employees “earn’’ the stock based on some condition such as seniority. Employees control the stock’s voting rights immediately, even though they may not take physical possession of the stock until specified conditions are met. This aligns the employees’ interests with those of the shareholders, as they are shareholders themselves.
Entrepreneur
A business person who accepts both the risks and the opportunities involved in creating and operating a new business venture.
Franchise
A form of business by which the owner (franchisor) of a product, service, or method obtains distribution/marketing through affiliated dealers (franchisees).
example: McDonalds
Franchising agreement
Specifies the duties and responsibilities of the franchisee and the franchiser.
Friendly takeover
An acquisition in which the management of the acquired company welcomes the firm’s buyout by another company.
General Partner
A partner who is actively involved in managing the firm and has unlimited liability.
Horizontal merger
A merger of two firms that have previously been direct competitors in the same industry.
Hostile takeover
An acquisition in which the management of the acquired company fights the firm’s buyout by another company.
Initial Public Offering (IPO):
Selling shares of stock in a company for the first time to the general investing public.
Inside directors
Members of a corporation’s board of directors who are also full-time employees of the corporation.
Limited liability
Investor liability is limited to their investments in the corporation; courts cannot touch the personal assets of investors if the corporation goes bankrupt.
Limited partner
A partner who generally does not participate actively in the business, and whose liability is limited to the amount invested in the partnership.
Merger
The union of two companies to form a single new business.
Microenterprise
An enterprise that the owner operates part-time from the home while continuing regular employment elsewhere.
Outside directors
Members of a corporation’s board of directors who are not also employees of the corporation on a day-to-day basis.
Parent corporation
A corporation that owns a subsidiary.
Partnership
A business with two or more owners who share in the operation of the firm and financial responsibility for the firm’s debts.
Preferred stock
Shares whose owners have the first claim on the corporation’s assets and profits but who usually have no voting rights in the firm.
Private corporation
A business whose stock is held by a small group of individuals and is not usually available for sale to the general public.
Public corporation
A business whose stock is widely held and available for sale to the general public.
Small business
An independently owned and managed business that does not dominate its market.
Sole proprietorship
A business owned and usually operated by one person who is responsible for all of its debts.
Spinoff
The strategy of setting up one or more corporate units as new, independent corporations. The corporation that does the spin-off is a parent corporation. (division of a business, type of divestiture)
Stock
A share of ownership in a corporation.
Stockholders/shareholders
Those who own shares of stock in a company.
Strategic alliance
An enterprise in which two or more persons or companies temporarily join forces to undertake a particular project.
Subsidiary corporation
One that is owned by another corporation.
Tender offer
An offer to buy shares made by a prospective buyer directly to a corporation’s shareholders.
Unlimited liability
Unlimited liability is when one or more business owners or partners are liable for their company’s debts and tax compliance. It is very different to a limited liability company (LLC), whose business structure is designed specifically to insulate individual partners or stakeholders from risk.
Vertical merger
A merger of two firms that have previously had a buyer-seller relationship.
Managerial Accounting
Capturing the business’s day-to-day financial activities in pursuit of an organization’s goals.
If a business negotiates a 3.6% discount rate and has credit card sales this month of $78,450, what amount does it owe the bank?
~A. $2,902.65
~B. $2,745.75
~C. $2,667.30
~D. $2,824.20
D
Commercial banks
Banks that offer service to the general public and companies.
Debt financing
Borrowing money and not giving up ownership, comes with interest and strict rules.
Liquid
A business’s current assets that are listed on financial statements are.
What is the base amount used for vertical analysis of items on the income statement?
Net sales
A common risk of innovation is…
loss of jobs
Buyout
The purchase of a controlling share in a company.
Cash flow statement
A financial statement that shows the movement in the cash account of a company. It presents cash inflows (receipts) and outflows (payments) in the three activities of business: operating, investing, and financing.
Investment
The act of committing money or capital to an endeavor with the expectation of obtaining an additional income or profit.
Financing
The act of providing funds/capital for business activities, making purchases, or investing and helping them achieve their goals.
Balance Sheet
A financial statement that summarizes a company’s assets, liabilities, and shareholders’ equity at a specific point in time. These three balance sheet segments give investors an idea as to what the company owns and owes, as well as the amount invested by shareholders.
Assets = Liabilities + Shareholders’ Equity
Liability
A company’s financial debt or obligations that arise during the course of its business operations
Shareholder’s equity
The net value of a company, or the amount that would be returned to shareholders if all the company’s assets were liquidated and all its debts repaid
Liquidate
Convert assets into cash or cash equivalents by selling them on the open market
Financier
Person or organization that provides capital for a company
Paradigm shift
A paradigm shift is a major change in how some process is accomplished. A paradigm shift can happen when new technology is introduced that radically alters the production process of a good
Vertical analysis
A method of financial statement analysis in which each entry for each of the three major categories of accounts (assets, liabilities and equities), in a balance sheet is represented as a proportion of the total account
Economic downturn
A fall in economic growth just before recession
Net sales
Net sales are the amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any discounts allowed
Sovereign immunity
A legal doctrine by which the sovereign or state cannot commit a legal wrong and is immune from civil suit or criminal prosecution
Eminent domain
The right of a government or its agent to expropriate private property for public use, with payment of compensation
Absolute privilege
A special right, advantage, or immunity granted or available only to a particular person or group of people
Consideration (in contract)
A benefit which must be bargained for between the parties, and is the essential reason for a party entering into a contract
Infringement
Act of breaking the law or agreements in a contract
National Labor Relations Act
An act protecting rights of employees and employers, encouraging collective bargaining (negotiation of wages and other subjects by a group fo employees)
Fair Labor Standards Act
Act
establishes minimum wage, overtime pay, record-keeping, and youth employment standards affecting employees
Vocational rehabilitation act
Prohibits discrimination on the basis of disability in programs conducted by Federal agencies
Americans with disabilities act
A civil rights law that prohibits discrimination based on disability
Industrial user
A company that buys materials from other manufacturers to satisfy their own needs
Open corporation
A corporation whose ownership shares are available for exchange on a public market
Consolidation
Combining small companies into one large one
Indirect agent
Promoters who are third-parties to a business, like a partner or affiliate, rather than a company’s personnels
Operating policy
A governing principle that mandates or constrains actions within a business
Agent
A person who represents a person or company in matters of business and who can make business decisions, agreements, etc., for them
Binding contract
An agreement in writing between two or more individuals or entities in which a court can impose penalties in the event one party attempts to negate on his or her promise
What are the three main factors in feasibility study?
- Staffing needs
- Return on investment
- Raw material needs
Tactical plans
Short-term plans for a business
Strategic plans
Long-term plans for a business
What factors should a small business owner consider when hiring someone?
Necessary skills and affordability
Market-segment analysis
Analyzing a group of potential customers and collecting information on them
Quota
A limited or fixed number or amount of people or things, in particula
Trade credit
The credit extended to you by suppliers who let you buy now and pay later
Return on equity
The ability of a company to generate income with their investments
Secondary needs
Wants such as entertainment or leisure
When determining its hiring needs, a business must consider its
Financial status and productivity needs
Payroll stub
A notice that the direct deposit transaction has gone through
Primary needs
Needs such as food, shelter
Corporate chain
Chain of a business, starbucks is a corporate chain
Economic system
A system of production, resource allocation, and distribution of goods and services within a society or a given geographic area
Performance measure
Regular measurement of outcomes and results, which generates data on the effectiveness and efficiency of programs
free card!!
:D
Measure of central tendency
mean, median, mode
Logistics
The part of supply chain management that plans the flow and storage of goods/services between the point of origin and the point of consumption in order to meet customer’s requirements
ARCI matrix
Accountable, responsible, consultive, informed. it defines roles and responsibilities
Sweepstakes
A type of contest where a prize or prizes may be awarded to a winner or winners. (kind of like a gamble)
Rebate
A partial refund to someone who has paid
Supervisory management
The action of overseeing and managing employees in the workplace. (low)
Middle level managment
They implement company strategy in the most efficient way. are higher in power than supervisory, but lower than execs.
Capillary
cloud-based marketplace
