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Business > March Exam > Flashcards

March Exam Flashcards

1
Q

A market

A

Where buyers and sellers meet to agree price

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2
Q

Competition

A

Rivalry amongst sellers

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3
Q

Business plan

A

It is used mainly when first setting up to plan the start up of the business, it includes the product/ service, marketing, finance, members etc

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4
Q

Franchises and franchisees

A

Franchises-brand that allows people to set up branches of their business
Franchisees- people that set up the branch

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5
Q

Co-operative

A

A business that is owned and ran by its members who have equal say

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6
Q

Ansoffs matrix

A

It is a tool used to show how a business could grow- product development, diversification, market penetration an market development.

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7
Q

Market size

A

The value of all the goods sold in that market

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8
Q

Market growth

A

The size of the market expands

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9
Q

Monopoly

A

A market with only one seller- or one where a business has 25% or more market share

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10
Q

Oligopoly

A

A market that is dominated by a few large sellers

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11
Q

Monopolistic competition

A

A market with many sellers that sell very similar products and compete on non price differences

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12
Q

Generally accepted accountancy principle (GAAP)

A

Framework of rules and principles for accountancy.

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13
Q

AP- consistency

A

All accounts will be produced in the same way

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14
Q

AP- going concern

A

Assumes that the business is being run normally and will be for the foreseeable

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15
Q

AP- matching (accruals)

A

When transactions are made

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16
Q

AP-materiality

A

The big picture- only counting assets that are important to the business

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17
Q

AP- objectivity

A

Looking at the real value of assets- no estimates or bias

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18
Q

AP- prudence (conservatism)

A

Not overstating things- better to understate than overstate

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19
Q

AP- realisation

A

Looks at when legal ownership changes not when payment is made

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20
Q

Break-even

A

When revenue is equal to total costs- the output level at which this is reached

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21
Q

Contribution

A

After variable costs have been covered it is any revenue that goes towards covering fixed costs or profit

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22
Q

Margin of safety

A

The difference between actual output and break-even level of output

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23
Q

Stepped cost

A

A cost that doesn’t change between a high and low threshold of activity

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24
Q

Depreciation

A

Assets deteriorate in value over time

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25
Return on capital employed (ROCE) ratio
Profit before tax/ long term capital employed (aka net assets+no- current liabilities) x100
26
Gross profit margin ratio
Gross profit/turnover x100
27
Net profit margin
Net profit/turnover x100
28
Return on equity
Net profit/ equity x100
29
Asset turnover
Turnover/net assets (non-current assets)
30
Stock turnover
Cost of sales/stock
31
Debtor collection period
Debtors/turnover x365
32
Creditor payment
Creditors/cost of sales x365
33
Current ratio
Current assets/current liabilities
34
Acid test ratio
Current assets-stock/current liabilities
35
Gearing ratio
Non-current liabilities/non-current liabilities+net assets x100
36
Interest cover
Profit before tax and interest (operating profit) / interest
37
Earnings per share
Profit after tax/ number of shares
38
Price earnings
Share price/ earning per share
39
Dividend per share
Dividend/ number of shares
40
Dividend yield
Dividend per share/ share price
41
Dividend cover
Profit after tax/ dividends
42
Workforce planning
The process used to plan the quantity and quality of workers that are required
43
Part time working
When workers only work for part of a week
44
Flexi-time
Workers have to work core hours but can work earlier or later than them- set amount of hours
45
Term-time working
Workers only work during school term time- holidays off
46
Time off in-lieu
During busy hours workers can be asked to work more but they will work less when it is not busy- set amount of hours
47
Job sharing
Workers share the amount they work, day to day or morning and afternoon
48
Remote working
Workers are able to work away from the office
49
Zero hour contracts
Workers have no set or guaranteed hours
50
Compressed hours
Workers have a set amount of hours but do them across less days eg 4 days
51
Annualised hours
Workers have a set amount of hours per year, they have set hours to work each week then extra that they are on call for- no overtime
52
Managerial appraisal
Appraisal done by the employees direct manager
53
Peer appraisal
Assessment done by colleagues
54
Self-assessment
Workers asses themselves before doing a managerial assessment
55
360 degree appraisal
Assessment done by everyone- peer, self, manager
56
Target setting
Setting SMART goals for employees to follow that are. Achievable and monitored
57
Lateness
Total number of late arrivals x100 / total number of scheduled attendances
58
Labour turnover
Number of employees leaving during a year/ average number employed during the year x100
59
Absenteeism
Total days absent in a month x100/ total available working days in a month
60
Workforce productivity
Output/ average number of employees
61
Holiday entitlement
Basic rate is 28 days a year if an employee works five days a week but it can be calculated by doing- the amount of days they work a week x5.6
62
Performance related pay
Y
63
Blake+ Mouton’s leadership grid
The level of focus on tasks and people- task focused-authoritarian, low both-impoverished, people focus-country club, high both-team leader, compromised both-middle of the road
64
McGregors theory x+y
Theory x- assumes staff are lazy, lack initiative, lack will/ability to work unsupervised and are motivated by money Theory y- assumes staff enjoy their work, willing to accept responsibility, are self-disciplined and not just motivated by money
65
Carlyle+ Galtons trait theory
``` M- motivational I-integrity S-self-confidence C-creativity I-intelligence ```
66
Tannenbaum+ Schmidt’s contingency approach
Authority focus-focus on use of groups | Tell—-sell—-consult—-participate
67
Adair’s three circle theory
Venn diagram between use of team, individuals and tasks
68
Leadership styles
Autocratic-full managerial control Paternalistic- leader decides what is best for the employees Democratic-leadership is shared within the group Laissez-faire-managers give employees little direction
69
Leadership
Workers want to follow them and are motivated by them
70
Forecasting
Using existing data to predict future trends
71
Limitations of forecasts
Only reliable as data used, careful about making assumptions from past data about the future, moving averages don’t look at recent/ more reliable data, doesn’t’t take into account changing objectives
72
Qualitative vs quantitative forecasting
Quan- numerical data | Qual-based on opinions
73
Qualitative methods of forecasting
Structured-Delphi technique, expert opinion | Unstructured- brainstorming and intuition
74
Quantitative methods of forecasting
Sales, costs, cash flow, profit
75
Seasonal variation
Variations that occur over the year- eg seasons,holidays, weather
76
Cyclical variation
Variations that occur as the business cycle changes
77
Calculate cyclical variation
Actual sales- (3yr) moving average
78
Information found by time series analysis
Trend, cyclical+ seasonal variations, random fluctuations
79
International trade
The trade of goods+ services across borders of countries
80
Exchange rates
One currency in terms of another
81
Factors considered when trading internationally
Language, logistics, culture and customs, currency and buying habits
82
Globalisation
Increased integration and interdependence of markets
83
Support for businesses that trade internationally
Export factoring- bank is middle man so ensures payment, export insurance, support+ training from the gov eg passport to export programme
84
Free trade
Trade without barriers- tariffs or quotas
85
Trading bloc
A group of countries often in one geographical area that protect themselves from imports from non-members
86
Benefits to businesses of trading blocs
Cheaper raw materials, access to a larger market, stability- selling in another market, economies of scale, access to foreign banks- more competitive interest rates
87
Disadvantages of trading blocs to businesses
Trade outside the bloc hindered, increased competition, easier to be taken over by foreign investors, increased regulation-cost
88
Advantages to a franchiser
Don’t have to spend loads to expand, franchisees have to get supplies from them- high prices, get revenue from franchisees
89
Disadvantages to the franchiser
Loss of control, cost of supporting them, there may be conflict
90
Advantages to a franchisee
Use of brand name, specialist training +advice available, easier to get loans, don’t have to do eg market research
91
Disadvantages to a franchisee
Royalty payments, supplies have to brought from the franchiser- high prices, is only for a fixed time, less control, cant sell it without permission
92
Delphi technique
Questionnaires are given to experts, they give their opinion on the what they think will happen, the results are then put into a report which is given back to the experts to get to an average result

Business (5 decks)

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