Influences in establishing a small to medium enterprise

Question 1

Australian Business Number (ABN)

Answer 1

a single identifying number that a business uses when dealing with government departments and agencies

Question 2

business activity statement (BAS)

Answer 2

A document that records a business’s claim for input tax credits and accounts for GST payable

Question 3

business opportunity

Answer 3

something an entrepreneur can see as an avenue to success. It is often identified when a person believe they can provide goods or services in a better or different way from those already on the market.

Question 4

commercial bills

Answer 4

short-term loans issued by financial institutions for larger amounts for a period of generally between 30 and 180 days

Question 5

competition

Answer 5

rivalry among businesses that seek to satisfy a market

Question 6

Competition and Consumer Act 2010

Answer 6

a law that protects both consumers and businesses. it protects consumers from deception or misleading practices, and it regulates the trade practices of businesses.

Question 7

debenture

Answer 7

a type of bond issued by a company for a fixed rate of interest and for a fixed period of time

Question 8

debt finance

Answer 8

relates to the short-term and long-term borrowing from external sources by a business

Question 9

equity finance

Answer 9

the funds contributed by the business owner(s) to start and then expand the business

Question 10

factoring

Answer 10

the selling of accounts receivable for a discounted price to a finance or factoring company

Question 11

feasibility study

Answer 11

an assessment of the business idea’s potential for success. This involves determining how practical the idea is and if it would successfully translate to the market.

Question 12

franchise

Answer 12

buying the rights from another business to distribute its products under its name

Question 13

franchisee

Answer 13

an individual or business that purchases a franchise

Question 14

franchisor

Answer 14

an individual or business that grants a franchisegoods

Question 15

goods and services tax (GST)

Answer 15

a broad-based tax of 10 percent on the supply of most goods and services consumed in Australia

Question 16

goodwill

Answer 16

the monetary value attached to the reputation of a particular business

Question 17

input tax credit

Answer 17

an allowable tax deduction that a business can claim for any GST included in the price of business inputs

Question 18

interest

Answer 18

the cost of borrowing money

Question 19

mortgage

Answer 19

a loan secured by the property of the borrower (business)

Question 20

on-costs

Answer 20

payments for non-wage benefitsover

Question 21

overdraft

Answer 21

when the bank allows a business to overdraw their account up to an agreed limit for specified time to overcome a temporary cash shortfall

Question 22

superannuation

Answer 22

a scheme set up by the federal government. It requires all employers to make a financial contribution to a fund that employees can access when they leave or retire from a job. The percentage of an employer must contribute will gradually to 12 percent by 2025.

Question 23

taxation

Answer 23

the compulsory payment of a proportion of earnings to the government

Question 24

unsecured loan

Answer 24

a loan from investors for a set period of time. It is not secured against the business’s assets.

Question 25

zoning

Answer 25

a means by which local councils allocate land for different uses, such has residential, commercial, recreational and industrial

Question 26

What is an advantage of buying an existing business?

Answer 26

Equipment is available for immediate use

Question 27

What is a key aspect of an ‘entrepreneur’?

Answer 27

risk taker

Question 28

Which organisation is responsible for the national business name registration service?

Answer 28

Australian