Business 101 Exam

Bus 101 Final Exam
 
Created Dec 16, 2009
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Side ASide B
Legitimacy
4 levels- Ownership, Legal Right, Moral Right, Interest (no legitimacy)
Power
Ability to influence the decision (money, public opinion, political power, etc)
Urgency
Want to influence the decision.
4 business processes
Acquiring customers, acquiring financial capital, managing human resources, creating value.
Acquiring customers
product (customer), price (cost), promotion (communication), Place (convenience)
Acquiring financial capital
Debt, equity, financial impact (cost and risk)
managing human resources
hiring/firing, retaining the best employees.
Creating value
raw material from suppliers,
Sarbanes-Oxley Act
protect owners/investors
Critical Thinking Skills
(0)confused fact finder, (1) biased jumper, (2) perpetual analyzer, (3) pragmatic performer,...
confused fact finder
looks for the only answer, doesn't seem to get it, quotes inappropriately, illogical/contradictory...
biased jumper
jumps to conclusions, doesn't recognize own biases, accuses others of being bias, stacks up...
perpetual analyzer
doesn't reach or adequately defend a solution, exhibits strong analysis skills, but appears...
pragmatic performer
considers alternatives before reaching conclusions, incorporates others in the decision process,...
Strategic re-visioner 
seeks continuous improvement, lifelong learning, anticipates change, thinks outside the box,...
revenue
sales, the top line, what customers pay
profit
net income, the bottom line, what owners receive after subtracting all business cost.
81st question
C
functions of an HR manager
strategic, associate advocate, administrative
strategic
20%=>60%, at the MGT table--collaborative, planning, measurement
associate advocate
30%=>30%, hr development, employee and labor relations, compensation and benefits, health...
administrative
50%=>10%, government reporting, payroll, osha reporting, legal complianace
employment at will doctrine (common law)
you can start and stop working someplace anytime for no reason
HR statutory laws
civil rights act, age discrimination act, equal employment opportunity act (affirmative action),...
"at will" exceptions
public policy-protects employees from being fired for refusal to commit crimescontractual actions-...
Model Employee Termination Act (META)
requires employers to at least show "good cause" for terminating you in states that have adopted...
sources of employee rights
statutory rights (government laws), collective bargaining rights (union contracts), enterprise...
alternative dispute resolution
hearing procedure-permits employees to be represented by an attorney or neutral partyombusman-a...
size of the U.S. GDP
$14 trillion
U.S market
300,000,000 (300 million)
world market
7,000,000,000 (7 billion)
how much profit do companies
3%
sole proprietorship advantages
easy to start, simple tax rules (business income=personal income)
sole proprietorship disadvantages
unlimited liability, limited resources available, limited growth potential. 
partnerships advantages
more resources available, can share the load, longer survival, no special taxes
partnerships disadvantages
unlimited liability in some forms of partnerships, division of profit, potential for disagreements,...
general partnership
each general partner manages the firm, each has unlimited liability.
limited partnership
at least one general partner with unlimited liability, rest are passive investors with limited...
corporation advantages
limited liability, greater acces to $, separation of ownership from management, ease of ownership...
corporation disadvantages
more costly to form, must keep accurate records, potential for conflicts with BOD, taxed twice...
Milton Friedman
strategic, owner profit
Edward Freeman
multi fiduciary, look out for all stakeholders
Blanchard & Peale's ethical check questions
Is it legal? Does it seem fair? How will it make me feel about myself?
owners
equity finance, stockholders, shareholders, investors
employees
not appointed by board, receive health benefits
customers
B2B & B2C, always look from the perspective of company
suppliers
raw material inputs and debt capital. No health benefits
society
environmental concerns, potential employees
income statement
sales-expenses=profit
cash statement
cash from operations +/- investments +/- financing
balance sheet
assets=liabilities+equitywhat you own=owed others +owed to yourself
contract law requirements
voluntary offer and acceptance, legal, competency, consideration
fiduciary must follow these obligations
loyalty, obedience, notification, accounting, reasonable care
principal has obligations
indemnification, reimbursement 
equity
issuing shares of ownership
debt
borrowing money
who gets paid back first... and then
secured debt, unsecured debt, preferred stock, common stock.
positives of debt
tax deductibility of interest, debt does not dilute control of the firm, lower cost of funds
disadvantages of debt
increases probability of financial distress, uses up potential debt capacity
problems with agency relationship
excessive perks, shirking, agents act in own best interest.
creating value decisions
how many factories, how much capacity at each, low cost or customizable products, what will...

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