MORT 202-MODULE I—Funeral Service as a Small Business

Rate

the annual percentage rate used to compute interest.

Liquidation value approach

the anticipated value of an asset that would be realized in case of liquidation of the business

Book Value

the cost of a fixed asset less accumulated depreciation

Replacement value approach

the fair market price to purchase similar assets

Board of directors

the governing body that is elected by the stockholders of a corporation.

Innovation

the introduction of something new; a new idea, method, or device

Small Business Administration (SBA)

the principal government agency concerned with the financing, operation, and management of small business.

Copyrights

the registered right of a creator to reproduce, publish, and sell the work which is the product of the intelligence and skill of that person

Patents

the registered right of an inventor to make, use, and sell an invention

Partnership

the voluntary business association of two or more persons who have combined their resources to carry on as co-owners of a lawful enterprise/business for their joint profit.

Corporation Charter

the written application for permission to incorporate that is approved by a state official.

Tangible assets

those assets that can be appraised by value or seen or touched

Intangible assets

those assets that cannot be touched or grasped (examples include patents, copyrights and goodwill)

Corporate refugee

Those individuals who flee the bureaucratic environment of big business by going into business for themselves.

Sole Proprietorship

a business owned and operated by one person

Manufacturing business

a business that makes finished goods from raw materials by hand or machinery

Service business

a business that provides a service as opposed to a product.

Merchandising business

a business that purchases finished goods for resale

Earnings valuation approach

a business valuation approach which centers on estimating the amount of potential income that may be produced by the business in the next year

Small Business

a business which is independently owned and operated and is not dominant in its field of operations.

Limited Liability Company (LLC)

a newer form of business ownership (approved in most states since approximately 1994); combined aspects of partnerships with the limited liability of a corporation; owners known as members.

Business plan (new venture plan)

a written description of a new idea that projects marketing, operational, and financial aspects of a proposed business.

Articles of Partnership

a written document that states explicitly the rights and duties of partners in a partnership.

Market value approach

an approach used in business valuation which determines value based upon previous sales of similar businesses

Corporation

an artificial being, invisible, intangible, and existing only in contemplation of law, an entity that is something that has a distinct existence separate and apart from the existence of its individual members. A legal form of organization whereby a legal entity is authorized by a state to operate a business under the entity's charter or articles of incorporation.

Goodwill

an intangible asset such as the name of funeral home; also an intangible asset which enables a business to earn a profit in excess of the normal rate of profit earned by other businesses of the same kind.

Trademarks

an intangible asset that is a distinct name, sign, or symbol that the federal government grants exclusive rights to use for a specified period of time

Business

an organization that combines inputs of raw materials, capital, labor, and management skills to produce useful outputs of goods and services so as to earn a profit.

Interest

money paid for the use of money.

Entrepreneur

one who organizes, manages, and assumes the risk of a business firm or venture.

Finance

the Business function of effectively obtaining and using funds.