What Are Corporate Objectives?

Question 1

What are corporate objectives?

Answer 1

They are objectives for the whole organisation

Question 2

Functional Objectives?

Answer 2

Objectives for different departments of a business

Question 3

Name 4 different functional areas of a business?

Answer 3

Marketing, financial, operations, Human Resources

Question 4

Why are functional objectives set?

Answer 4

To help archive the corporate objectives

Question 5

Why are corporate objectives set?

Answer 5

To archive the mission set (the purpose of the business)

Question 6

Objectives need to be smart, what does SMART stand for?

Answer 6

Specific
Measurable
Archievable
Realistic
Time bound

Question 7

What is the value of setting financial objectives (2 marks)

Answer 7

Objectives help with making decisions, they give a clear direction which motivates all workers something to work towards.

Question 8

How do you calculate profit?

Answer 8

total revenue - total costs

Question 9

How do you calculate total costs?

Answer 9

fixed costs + variable costs

Question 10

What is cash flow?

Answer 10

Cash in= cash out
examines the cash coming in and going pit in a business

Question 11

What is investment?

Answer 11

Spending on capital goods, e.g. machinery, goods which make other goods

Question 12

Revenue calculation?

Answer 12

price x quantity sold

Question 13

Give ways to increase revenue

Answer 13

Sell a wider range of products
Sell to different markets
Increase your target audience
Increase price if demand price is-inelastic I.e. won’t fall by much
Lower price if demand increases by a greater %

Question 14

Influences on objectives?

Answer 14

Ambitions of the CEO
Rising incomes
Rising incomes in different markets
Competition
Popularity of market

Question 15

Why would a business consider cost minimisation?

Answer 15

Business that compete on price would be keen to cut costs

Question 16

Name 4 cost minimisation objectives

Answer 16

reduce waste
reduce cost of raw materials- find new supplier
Lower unit costs by buying in bulk
Reduce wages per unit

Question 17

What are revenue objectives?

Answer 17

Are targets set for the amount of money coming into a business from sales in a set period of time.

Question 18

What are cost objectives?

Answer 18

Limits set for the amount of money to be spent on expenditure in a set period of time.

Question 19

What are profit objectives?

Answer 19

Targets set for the amount of surplus to be achieved in a set period of time

Question 20

Sale Revenue Equation?

Answer 20

Quantity sold x Selling price

Question 21

Gross Profit Equation?

Answer 21

Sales revenue - cost of salss

Question 22

Operating Profit

Answer 22

Gross profit - expenses

Question 23

Profit for the year Equation

Answer 23

Operating profit - interest and taxation plus one off sale

Question 24

What is cash flow?

Answer 24

Movement of money coming in and out of a business

Question 25

Why is cash flow important?

Answer 25

Required to meet shorter, objective for survival A healthy cash flow is necessary to meet day to day expenses

Question 26

Why is a cash flow target important?

Answer 26

To keep a surplus in order to take advantage of unforeseen opportunities

Question 27

What is the distinction between cash flow and profit?

Answer 27

Profit exists in financial records when total revenue is greater than total costs Cash is the physical existence of money within a business

Question 28

Internal Influences on a business?

Answer 28

Factors from within the business -corporate and other functional objectives -characteristics of the firm -relationship between owners and directors Public or private sector

Question 29

External Business Influences?

Answer 29

Factors from outside a business? -Competitors -Consumers -Economic Conditions -External Enviroment