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Commerce: BUSINESS > Establishing A Business > Flashcards

Establishing A Business Flashcards

1
Q

What are the advantages of becoming a franchisee?

A
  • pre-existing reputation
  • don’t have to start from scratch
  • less start up capital
  • owners receive specialised training
  • advertising costs are shared
  • bulk buying can reduce costs
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2
Q

What are the disadvantages of being part of a franchise?

A
  • have to pay for use of the brand
  • strict requirements
  • can’t create own ideas
  • difficult to expand
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3
Q

What are some examples of franchises?

A

McDonald’s, IGA, Boost, City Beach, Bakers Delight

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4
Q

Why is the location important?

A
  • proximity to customers, suppliers
  • rent costs
  • size of property
  • home business? Distractions?
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5
Q

What needs to be done in terms of staffing?

A
  • job descriptions (roles, characteristics, wages)
  • recruitment
  • interviewing and hiring
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6
Q

What does admin need to do?

A
  • wages
  • superannuation
  • taxes
  • sick and annual leave
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7
Q

What facilities are needed?

A
  • bathrooms
  • drinking water
  • need to be aware and compliant of all laws
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8
Q

What equipment is required?

A
  • utilities (electricity, phone, wifi)
  • light fittings, painting
  • floor coverings
  • stationery
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9
Q

What is a product/ tradename franchise?

A

Business firm gives exclusive rights to sell its products in exchange for fees or royalties.

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10
Q

What is a business format franchise?

A

Franchisor provides a format or a complete system for operating the business. This includes planning, management, location, appearance and image and quality of goods.

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11
Q

What are some local regulations for business operations?

A
  • land zoning
  • on site parking requirements
  • council may want to approve business signs
  • business activity is not allowed if it affects the quality of the residential neighbourhood.
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12
Q

What effects might businesses have on the residential neighbourhood? (Local regulations)

A
  • appearance of building
  • works or materials used
  • hours of operation
  • electrical interference
  • storage of dangerous goods
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13
Q

What laws determine state regulations on businesses?

A
  • workers compensation act

- occupation health and safety act

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14
Q

What is SIRA?

A

State Insurance Regulatory Authority

  • now in charge for workers compensation, SafeWork and icare (insurance and care nsw)
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15
Q

What are the state regulations (NSW)?

A
  • office of fair trading stuff

- OH & S laws

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16
Q

What is OH & S?

A

All employers must provide a safe working environment

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17
Q

What do risk management processes include (OH & S)?

A
  • identifying hazards
  • assessing risks
  • eliminating or controlling risks
  • reviewing risk assessments
18
Q

What are the federal regulations out on businesses?

A
  • ABN/ ACN
  • Tax File Number (TFN)
  • GST
  • registration with ASIC
  • discrimination rules
19
Q

What is an Australian Company Name?

A
  • nine digit number that every company must have

- ensures identification of companies

20
Q

Where should the ACN appear?

A
  • all of the company’s public documents and eligible negotiable instruments
21
Q

What is an Australian Business Number?

A
  • eleven digit number
  • identifies business to government and community
  • free
  • introduced in 2000 to enable businesses to deal with things using one number
22
Q

What taxes might a business be subject to?

A
  • income tax
  • Gst
  • fringe benefits tax
  • sales tax
  • customs and excise duty
23
Q

What is a Business Activity Statement used for??

A
  • reporting and paying GST
  • pay as you go (PAYG) installments
  • other tax obligations
24
Q

Who is required to lodge a BAS to the ATO?

A

All businesses registered for GST are required to lodge a BAS by the due date.

25
Q

What will businesses registered for GST do??

A
  • include GST in their prices

- claim credits for the GST included in the price of GST they buy for their business

26
Q

What are examples of when you can get a GST free sale?

A
  • GST export of goods
  • service used outside Australia
  • sale of a business is a going concern
  • selling a business

*see business book

27
Q

What is Fringe Benefits Tax?

A

Where employers pay on certain benefits they provide to their employees.

Benefit may be in addition to or as part of their salary/wage.

28
Q

When does the FBT year go from?

A

The FBT year runs from 1st April to the 31st March.

29
Q

What are examples of Fringe Benefits Tax?

A
  • car
  • car parking
  • entertainment
  • loans
30
Q

What is Customs and Excise Duty?

A

A commodity based tax on alcohol, tobacco and fuel and petroleum products.

31
Q

What are the federal employment laws?

A
  • workplace relations act
  • anti discrimination legislation
  • superannuation legislation
  • OH & S legislation
32
Q

How do you register for a company??

A

The company must complete form 201 and send it to ASIC.

33
Q

Who are the board of directors and who elect them?

A

A director is a person in charge of managing the company’s business activities. They are elected by the shareholders.

34
Q

How are directors different from management?

A

Directors make decisions, management carry out the decisions.

35
Q

What is the alternative document you can complete to form a company?

A

Form 401, which is an application for registration as a registrable Australian body.

36
Q

What is the role of WorkCover?

A

To assist in securing the health, safety and welfare of workers in NSW.

37
Q

What does WorkCover do?

A
  • provides information to the public about their rights in the workplace
  • provides services for workers to use (insurance etc)
  • informs about workplace behaviour (coded of practice)
38
Q

What is the role of the Office of Fair Trading?

A
  • make doing business in NSW “simple, accessible and fair”
  • promotes a fair marketplace for consumers and traders
  • regulates business operations
  • protects consumers from businesses behaving unjustly
39
Q

What is a prospectus?

A

A formal written document published by every firm offering its securities to public for purchase.

40
Q

When is a prospectus issued? Does it have to be checked?

A

Issued when securities are offered for sale. Must be lodged with ASIC before its issue.

41
Q

What are the four P’s of marketing?

A
  • product
  • price
  • promotion
  • place

Commerce: BUSINESS (10 decks)

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