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