Unit 1: SAC 4

Question 1

Describe two legal requirements to follow when establishing a business.

Answer 1

Businesses need to register their business under The Australian Securities and Investments Commission (ASIC) unless it is the owner’s name then it’s optional. This is to prohibit anyone else from trading under a similar name and to protect consumers by allowing them to identify the owner of a business name.

Whereas,

A domain name is the address of its website on the internet. To amass a larger market, businesses may have an online store or site where customers can access more information about their business. When they create a website domain, the name should mirror the activities of the business and be easily typed.

Question 2

What do you consider when choosing a bank?

Answer 2

Bank Fees
Interest rates
Overdraft facility
Credit cards
Convenience and support

Question 3

Distinguish between a business name and a domain name.

Answer 3

Businesses need to register their business under The Australian Securities and Investments Commission (ASIC) unless it is the owner’s name then it’s optional. This is to prohibit anyone else from trading under a similar name and to protect consumers by allowing them to identify the owner of a business name.

Whereas,

A domain name is the address of its website on the internet. To amass a larger market, businesses may have an online store or site where customers can access more information about their business. When they create a website domain, the name should mirror the activities of the business and be easily typed.

Question 4

Define Financial Control Systems.

Answer 4

This refers to the processes, methods, and tools that allow a business to accurately monitor and manage its financial performance.

Question 5

Explain two Financial Control Systems.

Answer 5

Budgeting: This technique involves the estimation of the financial performance of the business in the future.

Cash flow management: Refers to analysing how much money is going in and out of the business.

Question 6

Explain two Record keeping strategies.

Answer 6

Income statement: This shows how much net profit the business has earned and the costs involved.

Cash book: In a cash book, the left-hand side shows receipts (money going into the business) and the right-hand side shows payments (costs/ money going out of the business).

Question 7

Distinguish between financial control systems and record-keeping strategies.

Answer 7

Financial control systems are the processes, methods and tools that allow a business to accurately monitor and manage its financial performance. this can include budgeting, auditing, and cash flow management. Whereas, record-keeping strategies are the systems or methods that allow a business to monitor, manage and report its financial performance. This includes income statements, cash books, and balance sheets.

Question 8

What do businesses need to consider when choosing suppliers?

Answer 8

Quality: Buying good quality raw materials ensures customer satisfaction and improves the reputation of the business

Price: Businesses will want to lower their costs of production, so will generally choose lower-priced raw materials to stay profitable.

Proximity: It is in the business’s best interests to be close to a geographical location with their suppliers, as raw materials can be delivered quickly.

Reliability: Suppliers must be swift with delivery times.

Question 9

Define policies.

Answer 9

Rules enforced in a workplace eg. school uniform/phone ban policy at schools in Victoria.

Question 10

Define procedures.

Answer 10

The steps and processes that put the policies in practice.