q2 Flashcards
May be a sole proprietorship, partnership, or corporation engaged in merchandising, manufacturing, or service.
entrepreneurship venture
Defines the distinction between an entrepreneur and an ordinary businessperson
innovation / creativity
represents the final products from the production process and distributed to the customers
output
determines the quality of the output
GIGO “garbage in, garbage out”
three important elements in the production system
input, process, output
these are the manpower, materials, machine, design, instructions
input
Human workforce involved in the manufacture of products
manpower
stage of production where the materials are transformed into the final product with the aid of manpower and machine
production process / transformation process / conversion process
Process or technique of converting raw
materials to finished products
method
The production is completed by a single employee or a batch of employees
job order method
The production undergoes several stages, and the product is transferred from one worker to another
batch method
Adopted when the demand for the product is considered constant
continuous production system
physical output of the whole production process
product
Goods are produced just in time when the market needs or demands for them
just-in-time production system
Physical appearance, taste, or chemical content that can hardly be distinguished from that of the other products
homogenous product
Dissimilar characteristics, parts, and physical appearance
heterogenous product
process of bringing the products or services
to the customers
distribution
Refers to how the product will be produced
mode of production
Producing own products and considering the elements in the production process
manufacturing goods
Process will take place Homed-based, Commercial space for rent, Commercial space purchase
manufacturing sites
entrepreneurs who often buy the product or services to the manufactures and sell them at a mark up price to either wholesalers or retailers
distributors
The raw materials needed in the production of a product
materials
Adopted when the production process is short, and the machines are frequently changed
intermittent production system
The manufacturing equipment used in the production of goods or delivery of services
machine
The product is usually substantial in size and is bound by a specific time to complete it
project method
Collection of values, beliefs, principles, and expectations learned and shared by the employees, founders, stakeholders, and members of the management
business culture
environment within the business
internal / microenvironment
Assets or properties owned or controlled by the business
business resources
assets of the business that have physical appearance and form
can be touched and seen
tangible resources
Used, applied, or consumed within a short period or one year
current resources
Properties whose usefulness or benefits extend beyond one year
noncurrent / fixed resources
Degree by which all units across the business accept and
share a common culture
cultural integration
Degree by which the employees accept the culture of the unit or business
cultural acceptance
assets of the business that don not have physical appearance of form.
Cannot be touched
intangible resources
Formal organizational arrangement of the business in terms if hierarchy of positions, flow of communication, relationship of functional areas, and production and
marketing processes
business structure
Combination of entrepreneurial concepts and principles, entrepreneurial skills, and entrepreneurial characteristics
competency
SWOT meaning
strengths, weaknesses, oppourtunities, threats
BCG meaning
boston consulting group
tool used to visualize all the potential causes of a problem to discover the root causes
fishbone diagram
Products in low-growth markets with high market share
cash cows
products with low growth or market share
dogs
popular tool to evaluate the internal environment
SWOT Analysis
Products in high-growth markets with high market share
stars
Products in high-growth markets with low market share
question marks / problem child
process of developing, testing, and commercializing a product or service with the ultimate objective of solving the problem
of the primary target market
product development
objective is to identify errors, deficiencies, and issues that may impede the success of the product or service
focus group discussion
critical factor that the entrepreneur must validate before launching the product or service because this can strongly suggest if the business will be successful or not
market acceptability
entrepreneur must ensure that the product or service complies with all relevant laws and regulations and has a necessary license or permit to operate a particular business
legality and ethical test
The entrepreneur must ensure that the product is safe to use, safe to be consumed (food and beverages), and safe to be applied (cosmetic products)
safety test
entrepreneur can match the expected costs versus his or her budget
product costing test
Each component of the product or service must be tested independently to identify component failures for goods or service failures for services
component test
entrepreneur must test a similar line of products or the competitor’s product or service itself to compare and get the best practices to be applied to the new product or service
competitor’s product / service test
Money that will be allocated by the entrepreneur to establish a business
capital
Value that’s created and captured by a company
profit margin
High-value asset that is submitted by the business to the bank when applying for a loan and will be subject to repossession if the business
defaults
collateral
Output of a sale wherein the sales price exceeds the cost to produce the product or render the service
revenue
who proposed the value chain
michael porter
when the product is already sold, or service has been rendered regardless of whether the business is paid in cash or credit
considered earned
when the product or service has not yet been delivered or sold but the
customer already paid in advance
considered deferred
all the processes related to receiving, storing, and distributing inputs internally
inbound logistics
transformation activities that change inputs into outputs that are sold to customers
operations
Activities that deliver your product or service to your customer
outbound logistics
Processes you use to persuade clients to purchase from you instead of your competitors
marketing and sales
Assist you to meet your
business goals
financial forecasts
Activities related to maintaining the value of your product or service to your customers, once it’s been purchased
services
may be more
appropriate for a stable, established business
monthly / quarterly forecasts
may be necessary
when starting your business, experiencing rapid
growth, or having financial difficulties
monthly / weekly forecasts
allow you to closely monitor
your finances and develop strategies to fix
problems before they become major issues
regular forecasts
Tied directly and proportionately to changes in
production amount or number of units sold
variable expenses
Not dependent on changes in production amount
or number of units sold
fixed recurring expenses (non-labor)
sum of all direct costs associated with
making a product
Cost of good sold
estimates your ongoing
operational costs over a period of time
expense forecast
These are expenses that you will only incur once,
very infrequently, and/or irregularly
one-time expenses
Estimates the amount of money you expect to flow in (receipts) and out (payments) of your business, including projected
income and expenses
cash flow
what a company owes
liability
amount invested in the company by shareholders
shareholders’ equity
Cash gained/lost from actual business operations
operating activities
Cash gained/lost from buying (and selling) property, plants, and equipment (PPE) and purchasing (and selling) long-term investments
investing activities
Cash gained/lost from issuance and reacquisition of a firm’s debt and capital stock, and dividend payments
financing activities
Picture of the separate steps of a process in sequential order
flowchart
systematic way of recording the financial transactions of a business
bookkeeping
series of steps that businesses take to track transactions and consolidate financial information over a specific accounting period (month, quarter, year)
accounting cycle
Basic phase of accounting is also known as bookkeeping
recording
system of recording information about a business, mainly numerical, and helps different people make decisions relating to that business
accounting
Provides the description of the type and nature of the business transactions
account titles
List of account titles adopted by a business to organize the recording process and segregate accounting values into assets, liabilities, capital, income, and expense
chart of accounts
There is only one debit and one credit
only has 1 debit and 1 credit
Requires a combination of debit and credit for every accounting entry to adhere to the balance sheet and income statement equations
double-entry bookkeeping
The journal entry appears to have two debit values, while credit has only one value or vice versa
compound entry
events where there are
exchanges of values that are measurable in one common denominator
transaction
book of original entries
general journal
All entries appearing in the general journal are fully supported with business documents
business documents
Sorting and grouping similar items under the
designated name, category, or account
classifying
Book in which classifications are recorded
ledger
Process of transferring the same information from the journal to the ledger
posting
Process of adding the debit and the credit money columns of the ledger and finding their balances
footing
Summarizing the data after each accounting
period, such as a month, quarter, or year
summarizing
Listing of the debit and credit
balances of accounts from the general ledger
trial balance
Structured financial
statement that presents the income, expenses, and net income or net loss realized during a certain period
income statement
