BA 101 Midterm 2 Terms
steps used in PERT
(1) analyzing and sequencing tasks that need to be done (2) estimating the time needed to complete each task (3) drawing a PERT network illustrating the information from steps 1 and 2 (4) identifying the critical path
ISO 14001
A collection of the best practices for managing an organization's impact on the environment.
Materials Requirement Planning (MRP)
A computer-based operations management system that uses sales forecasts to make sure that needed parts and materials are available at the right time and place.
Enterprise resource planning (ERP)
A newer version of materials requirement planning (MRP) that combines the computerized functions of all the divisions and subsidiaries of the firm—such as finance, human resources, and order fulfillment—into a single integrated software program that uses a single database.
just-in-time (JIT) inventory control
A production process in which a minimum of inventory is kept on the premises and parts, supplies, and other needs are delivered just in time to go on the assembly line.
Six Sigma Quality
A quality measure that allows only 3.4 defects per million opportunities.
Operations Management
A specialized area in management that converts or transforms resources (including human resources) into goods and services.
Money Supply
Amount of $ the Fed Res makes available for people to buy goods and services
Accounting Cycle
Analyze Record Transfer Trial Financial Statements Analyze
Accounting Equation
Assets = Liabilities + Owners Equity
Financial Planning
Forecasting the firms financial needs developing budgets Establishing financial controls to achieve goals
critical path
In a PERT network, the sequence of tasks that takes the longest time to complete.
The Production Process
Inputs (land, labor, capital, knowledge) Production Control (planning, routing, scheduling, dispatching, follow-up) Outputs (goods, services, ideas)
ISO 9001
The common name given to quality management and assurance standards.
Production
The creation of finished goods and services using factors of production
Reserve Requirment
a % of commercial banks checking/savings accounts they must keep in the bank or in a non-interest-bearing deposit @ local Red district banks
Line of Credit
a given amount of unsecured short term funds a bank will lend to a business, provided the funds are readily available
Financial control
a process in which a firm periodically compares its actual revenues, costs, and expenses with its budget
intermittent process
a production process in which the production run is short and the machines are changed frequently to make different products
Letter of Credit
a promise by the bank to pay the seller a given amount if certain conditions are met
Financial Statement
a summary of all financial transactions that have occurred over a particular period
retained earnings
accumulated earnings from the firms profitable operations that are reinvested in the business and not paid out to stockholders in a distribution of company profits
fixed-position layout
allows workers to congregate around the product to be completed
Money
anything people generally accept as a payment for goods/services
Secured Loan
backed by collateral, something valueable like property
Computer-aided manufacturing
bringing computers directly into the production process
Computer-aided Design
business ranging from construction companies to carmakers to video game designers depend on 3d modeling software to create new products
Demand Deposit
checking account; money that is available on demand
M-1
coins and paper bills, money that is available buy writing checks, and money held in travelers checks; money that can be accessed easily and quickly
Smart Card
combines credit/debit card, phone card, drivers license, and more
accounts payable
current liabilities or bills the company owes others for merchandise or services it purchases on credit but has not yet paid for
Flexible manufacturing
designing machines to do multiple tasks so they can produce a variety of products
Unsecured Loan
doesnt require any collaterals
Assets
economic resources owned by a firm
Savings and Loans Association (S&L)
financial institution that accepts both saving/checking deposits and provides home morgages loans
Nonbanks
financial organizations that accept no deposits but offer many services provided by regular banks
5 key working areas of accounting
financial, management, auditing, tax, gov't/non-profit
Financial Accounting
generates financial info for people primarily outside organizations
M-2
includes M-1, plus money in savings accounts, market accounts, certificates of deposits; money that may take more time to obtain
M-3
includes M-2, plus deposits like institutional money market funds
Federal Deposit Insurance Corporation (FDIC)
independent agency of the US gov't that insures bank deposits
continuous process
is one in which long production runs turn out finished goods over time
Facility location
is the process of selecting a geographic location for a company's operations
fixed assets
long-term assets that are relatively permanent, land, buildings, and equipment
bonds payable
long-term liabilities, money lent to the firm by bondholders that it must pay back
Making Ethical decisions
looks at the kinds of decisions companies make when it comes to locating
Capital Expendutures
major investments in either tangible, long-term assets and intangible assets
Factor
market intermediary that agrees to buy the firms account receivable at a discount for cash
Electronic Funds Transfer System (EFT)
messages about a transaction are sent from one computer to another`
Equity Finance
money raised from within the firm from operations or through the sale of ownersip in the firm (stock)
Venture Capital
money that is invested in new or emerging companies that are perceived as having great profit potential
Pension Funds
monies set aside by corporations, non-profits, or unions to help fund their members financial needs when they retire
Credit Unions
non-profit, member owned financial cooperatives that offer the fill variety of baking services
process layout
one in which similar equipment and functions are grouped together
facility layout
physical arrangement of resources/people to most efficiently produce goods and provide services
Process Manufacturing
physically or chemically changes materials
5 standards for a useful form of money
portability divisibility stability durability uniqueness
Short-term forecast
predicts revenues, costs, and expenses for a period of one year or less
Long-term Forecast
predicts revenues, costs, and expenses, for a period longer than one year, 5-10 years
Cash Flow forecast
predicts the cash inflow and outflows in future periods, usually months or quarters
World Bank
primarily responsible for financing economic development
commercial banks
profit-seeking organizations that receive deposits from individuals and businesses in the form of checking/savings accounts, and uses these funds to make a loan
bankers acceptance
promises that the ban will pay some specific amount @ a particular time; no conditions
A term-loan agreement
promissory note that requires the borrower to repay the loans with interest in specified monthly or annual installments
Public Accountant
provides accounting services to individuals or businesses
Managerial Accounting
provides info/analysis to managers inside the organizations to assist in decision making
assembly process
puts together components to make a product
Leverage
raising funds through borrowing to increase the firms rate of return
Debt Finance
refers to the funds raised through various forms of borrowing that must be repaid
Balance sheet
reports firms financial condition on a specific date
Auditing
reviewing/evaluating info used to prepare a companies financial statments
Time Deposit
savings account; bank can require prior notice before withdrawl
Budget
sets forth managements expectations for revenues and on the basis of those expectations, allocates the use of specific resources throughout the firm
income Statment
summarizes revenues, cost of goods sold, expenses for a specific period and highlights the total profit or loss the firm experiences during that period
statement of cash flow
summary of money coming into and going out of the firm
Mass customization
tailoring products to meet needs of a large number of individual customers
modular layout
teams of workers combine to produce more complex units of the final product
Quantitate Easing
the Fed creating more $ when it believes that money is needed to get the economy moving again
Open-market operations
the buying and selling of gov't bonds
Barter
the direct trading of goods and services
Finance
the function in a business that aquires funds for the firm and manages them within a firm
Purchasing
the function in a firm that searches for high-quality material resources, finds the best suppliers, and negotiates the best price for goods and services
Risk/Return trade off
the greater the risk of a lender takes, the higher rate of interest they will receive
Discount Rate
the interest rate the Fed charges for loans to member banks
Financial managment
the job of managing a firms resources to meet its goals and objectives
Revenue
the monetary value of what a firm received for goods sold, services rendered, and other payments
Trade Credit
the practice of buying goods/srvices now and paying for them later
Lean manufacturing
the production of goods using less of everything than in mass production
Form Utility
the value producers add to materials in the creation of finished goods and services, such as by transforming silicon into computer chips or putting services together to create a vacation package
Certificate of Deposit (CD)
time deposit that earns interest to be delivered on the certificates maturity date
Tax accountant
trained in tax law and is responsible for preparing tax returns or developing tax strategies
Computer integrated manufacturing
uniting software programs to reduce the time needed to program machines
Debit Card
withdrawals funds from a checking account; same function as checks
Private accountant
work for a single firm, gov't agency, or non-profit
assembly-line layout
workers do only a few tasks at a time
Telecommunting
working from home via. computer
Annual Report
yearly statement of financial condition progress, and expectations of an organization