BUSI 336 Intro to Entrepreneurship (Chapter 17, 3, 10, 11 terms)

vicarious

(indirect) liability Indirect liability or responsibility for the actions of another.

501(c)(3)

501(c)(3) refers to a section of the U.S. Tax Code that specifies the conditions for a nonprofit organization to be certified tax-exempt, meaning it does not pay any federal income taxes. In addition to saving taxes, 501(c)(3) status gives the recipient organization the ability to legally tell donors that their donations are also tax-exempt, which makes such donations a way to decrease the amount on which taxpayers would have to pay income taxes. This is one of the big incentives to non-profits to increase the attractiveness of getting donations

design patent

A 14-year patent for a new, original, and ornamental design for an article of manufacture.

utility patent

A 20-year patent covering a process, machine, article of manufac-ture, composition of matter, or any new or useful improvement of an existing one.

plant patent

A 20-year patent that covers new strains of living plant organisms, algae, or macro fungi.

hourly fees

A basis for legal charges in which the rate is based on a price per hour. Often lawyers will charge for fractions of an hour.

legal entity

A being, human or nonhuman, such as a corporation, that is recognized as having rights and duties, such as the right to own property.

nonprofit corporation

A business form specific to charitable organizations (i.e., organizations that do not make a profit for their owners). Nonprofit business charters differ in the kinds of responsibilities the nonprofit has, compared to the other forms of for-profit business forms. Non-profits are the only form of business that can seek 501(c)(3) status from the IRS, which permits donations to the nonprofit to be considered tax-deductible to the donor.

check the box taxation

A choice LLCs can make on their tax returns to be taxed as a corpo-ration or a partnership.

operating agreement

A contract among LLC members outlining how the LLC will conduct itself.

subcontract

A contract by which a new party agrees to perform a duty that one of the original parties to a contract was already legally obligated to perform.

Arbitration

A dispute resolution process held instead of court cases in which both sides present their case to a legal professional.

mediation

A dispute resolution process held instead of court cases in which both sides present their case to a neutral third party who is not a judge. Unlike arbitration and court decisions, mediation decisions are not binding on the two parties.

Sarbanes-Oxley Act (SOX)

A federal law describing the steps publicly traded businesses must take to protect and provide their key financial information.

Retainer

A fee paid by a client to an attorney to engage the attorney's services.

Litigation

A formal dispute resolution method that operates using the court system, typically with a law-yer representing each party.

patent

A grant by the U.S. government to an inventor for an idea that is new, useful, and nonobvious, giving the inventor the exclusive right to make, use, or sell his or her idea.

Limited Liability Partnership (LLP)

A limited liability partnership (LLP) is organized to protect individual partners from personal liability for the negligent acts of other partners or employees not under their direct control.

flat fees

A method of billing for lawyers in which a fixed amount is paid for a certain task.

provisional patent

A preliminary description of your idea submitted to the U.S. Patent Office according to its specifications. It is intended to serve as a sort of placeholder for a full (or regular) patent, which needs to be filed within one year of the filing of the provisional patent.

opinion of patentability

A report (typically written as a letter) from a patent attorney or patent agent that is his or her professional opinion of the possibility of obtaining a patent for an idea that you have explained. The opinion is based on the attorney's or agent's research of patents for similar or related ideas. Typically the first official step in the patent-ing process.

hold harmless

A type of waiver in which a party agrees not to hold another party responsible for certain events.

articles of partnership

Agreement between the partners of a firm on matters pertaining to the formation and operation of the partnership.

grace period

An idea in patent law that says disclosing the idea starts a one-year clock for filing a provisional or regular patent, where the disclosure would not count as "prior art" and disqualify the idea from being patented (since as "prior art" it was already publicly known). These grace period dis-closures are strongest if they are limited to specific people (versus publicizing an idea on the Internet or in mass media).

business-to-business (B2B)

Business-to-business transactions using e-commerce.

business-to-consumer (B2C)

Business-to-consumer transactions using e-commerce.

trade secret

Confidential information within a company that gives that company a competitive advantage.

trademark

Distinctive word, slogan, or image that identifies a product and its origin.

articles of organization

Document setting forth information about a limited liability company that is filed with the state to establish an LLC.

pass through (taxation)

Earnings of the business are dis-tributed to the business owners and those owners (rather than the business) pay individual tax on the earnings.

double taxation

Earnings of the business are taxed twice with the business as well as its owners being subject to tax.

copyright

Exclusive right given to the creator of a literary or artistic work to make use of that work.

contingency fee

Fee paid by a client to an attorney for legal services that is dependent on the outcome of a case.

assumed name filing or fictitious name filing

Filing made with a state(s) in which the business operates disclosing the trade name or assumed name of the business along with the owners of the business.

waiver

Part of a contract in which a party intentionally gives up legal rights or claims.

exculpatory clause

Part of a contract in which a party to the contract states that he or she will not be responsible for certain actions.

noncompete clause

Part of a contract in which a person agrees not to open a certain type business or seek employment doing certain things in a particular area for a period of time.

defendant

Person or other entity being sued.

plaintiff

Person or other entity filing a lawsuit.

independent contractors

Persons working to achieve a certain goal without being subjected to substantial controls by another.

intangible property

Property that has no value of its own but that represents value, such as a stock certificate.

infringer

Someone who uses intellectual property without the permission of the owner.

piercing the veil

The dissolution of a corporate form, making it back into a sole proprietorship or general partnership, if the court finds that the owner carelessly mixed up personal and business assets or finances.

trade name or assumed name or doing business as (dba) name

The name under which a business is operated.

employee stock ownership plan (ESOP)

a form of profit sharing, borrows money, purchases some of the company's stock, and allocates it to the employees on the basis of salaries and/or longevity.

proprietorship

also known as a sole-proprietorship, is a business that is owned by one person.

Merit increases

are based on the employee's ability and performance.

Job specifications

are detailed written statements of work assignments and the qualifications needed to do the job acceptably.

In-depth, preemployment, or diagnostic interviews

are detailed, probing, and penetrating interviews seeking to determine the applicant's character and other aspects of personality.

articles of copartnership

are drawn up during the preoperating period to show rights, duties, and responsibilities of each partner.

articles of incorporation

are the instrument by which a corporation is formed under the corporation laws of a given state.

Employee benefits, or fringe benefits

are the rewards and services provided to workers in addition to their regular earnings.

Apprenticeship training

blends OJT with learning of theory in the classroom.

fractional ownership

can be defined as a percentage share of an expensive asset

Internship training

combines OJT with learning at a cooperating school or college.

limited-liability company (LLC)

combines the advantages of a corporation, such as liability protection, with the benefits of a partnership, such as tax advantages.

general partnership

each partner actively participates as an equal in managing the business and being liable for the acts of other partners.

single taxation

earnings of the business are taxed once with the owners paying the taxes.

buy-sell agreement

explains how stockholders can buy out each other's interest.

On-the-job training (OJT) or on-the-job learning (OJL)

has the worker actually performing the work, under the supervision of a competent trainer.

Selection

involves choosing the applicant who has the qualifications to perform the job.

E-training

involves computer interaction with either specific software packages or specific online sites for employee training.

Workers' compensation

involves payments made to employees for losses from industrial accidents and occupational diseases.

Staffing

involves planning for, recruiting, selecting, and training and developing employees, as well as compensating them and providing for their health and safety

Upgrading

involves retraining workers so they can do increasingly complex work.

Cross-training

involves workers learning many job skills so they are more versatile.

corporation

is a business formed and owned by a group of people, called stockholders, given special rights, privileges, and limited liabilities by law.

cooperative

is a business owned by and operated for the benefit of patrons using its services.

partnership

is a business owned by two or more persons who have unlimited liability for its debts and obligations.

Push money (PM), or spiff

is a commission paid to a salesperson to push a specific item or line of goods.

Social Security

is a federal program that provides support for the retired, widowed, disabled, and their dependents.

joint venture

is a form of temporary partnership whereby two or more firms join in a single endeavor to make a profit.

defined-contribution plan

is a pension plan that establishes the basis on which an employer will contribute to the pension fund.

C corporation

is a regular corporation that provides the protection of limited liability for shareholders, but its earnings are taxed at both the corporate and shareholder levels.

bonus

is a reward—not specified in advance—given to employees for special efforts and accomplishments.

S corporation

is a special type of corporation that is exempt from multiple taxation and excessive paperwork.

Profit sharing

is an arrangement—announced in advance—whereby employees receive a prescribed share of the company's profits.

Polygraph

is an instrument for simultaneously recording variations in several different physiological variables.

nonprofit corporation

is formed for civic, educational, charitable, and religious purposes.

commission

is incentive compensation directly related to the sales or profits achieved by a salesperson.

Validity

is making sure that the test given actually relates or corresponds to job performance.

Transferring

is moving an employee from one job to another, without

Promoting

is moving an employee to a higher position, usually with increased responsibilities, title, and pay.

limited liability partnership (LLP)

is organized to protect individual partners from personal liability for the negligent acts of other partners or employees.

Recruitment

is reaching out to attract applicants from which to choose one to fill a job vacancy.

incentive wage

is the extra compensation paid for all production over a specified standard amount.

Equal Employment Opportunity Commission (EEOC)

is the federal agency primarily responsible for enforcing EEO laws.

family limited partnership (FLP)

is the organizational type where the majority of the partners are related to each other as spouses, parents, grandparents, siblings, cousins, nieces, or nephews.

Networking

is the process of establishing and maintaining contacts with key persons in one's own or another

Job description

lists the duties and responsibilities of a given job.

professional service corporation (PSC)

must be organized for the sole purpose of providing a professional service for which each shareholder is licensed.

limited partnership

one or more general partners conduct the business, while one or more limited partners contribute capital but do not participate in management and are not held liable for debts of the general partners

Affirmative action programs (AAPs)

provide guidelines to help firms eliminate discrimination against women and minorities.

Unemployment insurance

provides some financial support to employees laid off for reasons beyond their control.

Leased manpower

refers to employees obtained from an outside firm that specializes in performing a particular service

The Family and Medical Leave Act

requires employers with 50 or more employees to provide up to 12 weeks of unpaid leave for births or adoptions, and to care for sick children, spouses, or parents

Americans with Disabilities Act (ADA)

requires the removal of many social and physical barriers to employing the disabled.

corporate charter

states what the business can do and provides other organizational and financial information.