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43 Cards in this Set

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  • Back
sole proprietorship
a business owned and run by one person
advantages of a sole proprietorship
1. little effort in starting up
2. decisions are made quickly
3. owner enjoys profits without having to share
4. doesn't have to pay sepaate business taxes
sole proprietorship disadvantages
1. owner has unlimited liability
2. difficuity in raising financial capital
3. size and efficiency
4. owner has limited experience
5. difficuliy of attracting qualified employees.
6. limited life
limited life
business does not exisit anymore when owner dies, quits, or new owner is added applies to sole proprietorships or partnerships
unlimited liability
owner is personally and fully responsible for all loses and debts of the business
inventory
a stock of finished goods and parts in reserve to satisfy customers or to keep production flowing smoothly
partnership
a business is jointly owned by two or more people
advantages of a partnership
1. little effort in establishment
2. lack of special taxes
3. can usally attract financial capital easier
4. larger size, makes for more efficient operations
disadvantagesvof a partnership
1. each partner is responible for the acts of all other partners
disadvantages of a partnership
1. each partner is responsible for the acts of all the other partners
2. conflicts may occur between partners
bankruptcy
court granted premission for an indivual or business to cease or delay debt payments
corporations
a form of a business organization recongized by law as a seperate legal entity having all the rights of an indiviual
charter
a government document that gives permission to create a corporation
stock
certificate of ownership in a corporation
stockholder
person who owns stock in a corporation
dividend
check paid to stockholders
credit union
a financial organization that accepts deposits from and makes loans to employees of a certin company or government agency
advantages of a corporation
1. easy to raise financial capital
2. directors of corporation can hire professional mangers to run the firm
3. provides limited libility for owners
4. unlimited life
bond
written promise to repay the amount borrowed at a later date
disadvantages of a corporation
1. difficulty and expense of getting a charter
disadvantages of a corporation
1. difficulit and expensive to get a charter
2. double taxation of corporate profits
double taxation
dividends are taxed twice
merger
a combonation of two or more business to form a single firm
income statement
a report showing a business's sales, expenses and profits for a certian period of time
net income
the measure if a business profits determined by subtracting all expenses, including taxes, from revenues
depreciation
a non-cash charge the the firm takes for the general wear and tear on it's capital goods
cash flow
the sum of net income and non-cash charges
horizontal merger
when two or more firms that produce the same kind of product and join forces
vertical merger
when firms involved in different steps of manufacturing or marketing join together
conglomerate
a firm that has at least four business, each making unrelated products
multinational
a corporation that has manufacturing or serivce opperarions in a number of different countries
nonprofit organization
operates in a businesslike way to promote the collective intrests of its members rather then to seek financial gain
nonprofit organization
operates in a businesslike way to promote the collective intrests of its members rather then to seek financial gain
nonprofit organization
operates in a businesslike way to promote the collective intrests of its members rather then to seek financial gain
cooperative or co-op
a voluntary association of people formed to carry on some kind of economic activity that will benefit its members
credit union
a financial organization that accepts deposits from and makes loans to employees of a certin company or government agency
credit union
a financial organization that accepts deposits from and makes loans to employees of a certin company or government agency
labor union
organization of workers formed to represent its members intrests in various employment matters
collective barganing
when it negotiaties with management over job related matters such as health care coverage
professional associations
a group of people in a specialized occupation that works to improve things like the working conditions.
chamber of commerce
promotes the welfare of its members and of the community
better business bureau
a non-profit organization sponsored by local business to provide general information on companies
limited partnership
form of partnership where one or more partners are not active in the daily running of the business