Management final class notes for FINAL

Question 1

What is the mission statement?

Answer 1

A statement of a company’s purpose

Question 2

What should the mission statement address and include?

Answer 2

Should address the key stakeholders for organization and should include key skills and resources that a company can offer

Question 3

What is the vision statement?

Answer 3

Future-oriented statement of what a company wants to become

Question 4

What is the process by which a company creates a strategy?

Answer 4

Strategic management

Question 5

What are the 2 types of strategic management strategies?

Answer 5

Corporate and business-strategy

Question 6

What should the corporate strategy answer?

Answer 6

What business to be in

Question 7

What are two types of corporate strategies?

Answer 7

Synergy and diversification

Question 8

What is a technique used to spread out risk (i.e. investment)

Answer 8

Diversification

Question 9

What is synergy?

Answer 9

2 or more activities that create an effect (greater than the sum of the parts)

Question 10

What should the business-strategy answer?

Answer 10

How to compete (ie cost and marketing)

Question 11

What does a SWOT analysis measure?

Answer 11

Internal scans such as strengths, weaknesses, opportunities and threats

Question 12

What was fayol’s definition of control?

Answer 12

Ensuring performance doesn’t deviate from standards

Question 13

What are 3 steps that comprise controlling?

Answer 13

1) establish performance standards, 2) compare actual vs standard performance, 3) taking corrective action

Question 14

What is the definition of financial control?

Answer 14

The management of a firm’s cost and expenses in relation to budgeted amounts

Question 15

What are the 3 types of financial statements?

Answer 15

Balance sheets, income statement, and cash flow statement

Question 16

What is an intangible asset?

Answer 16

Non-physical assets that give a company a preferred position in the marketplace (goodwill, patents, copyrights, franchises)

Question 17

What is the amount willing to pay for a company over and above book value?

Answer 17

Goodwill

Question 18

What is a current asset?

Answer 18

What a company owns that can be readily converted to cash (cash, accts receivable, inventory)

Question 19

What are long term/fixed assets?

Answer 19

Assets not readily converted to cash (property, plant, equipment, LT investments, intangible assets)

Question 20

What is a liability due within 1 year?

Answer 20

Current Liabilities (accts payable, payroll, taxes, st portion of LTD)

Question 21

What is long term debt?

Answer 21

Liabilities due 1 year or more into future (LT portion of LTD)

Question 22

What is owners equity?

Answer 22

amount of money shareholders invested in the firm (common stock and retained earnings)

Question 23

What is the Balance sheet formula?

Answer 23

CA + CL = owners equity

Question 24

What are labor expenses and cost of finished goods sold?

Answer 24

COGS

Question 25

What are operating expenses?

Answer 25

Not directly related to making a product ( rent, commission, sales general administrative SGA)

Question 26

What are the portions of the Cash flow statement?

Answer 26

Net income and types of cash flow

Question 27

What are the 3 types of cash flow?

Answer 27

1) operational (sales revenue - inventory and accts receivable) 2) investment ( cash received or spent on LTA) 3) financing (cash received and spent on debt