Intro to Business Final
Derek, an accountant, allocates the cost of a piece of earth-moving equipment over a specific period of time. Based on the given information, it can be concluded that Derek is implementing the process of
depreciation.
The process of spreading the costs of long-lived assets, such as buildings and equipment, over the total number of accounting periods in which they are expected to be used is called
depreciation.
In the context of the marketing concept, which is the first step that a business must take?
find out what consumers desire
For most organizations, the ultimate objective is
for the produced outputs to be worth more than the cost of inputs.
intangible and tangible products differ
from an operations standpoint- Services are intangible and without physical attributes. On the other hand, goods are tangible and can be weighed or measured based on their physical aspects.
three accounting instruments
income statement, balance sheet, statement of cash flows
Glen is a carpenter who performs home repairs and improvements for his customers. From the perspective of operations, the money he uses to purchase his tools and the electricity he uses to run his power saw are
inputs
Hannah borrowed money from a bank to start her new company. Her direct cost of borrowing this money is known as her ________ expenses.
interest
statement of cash flows
is a financial statement that summarizes the amount of cash and cash equivalents entering and leaving a company.
income statement
is one of a company's main financial statements. The purpose of the income statement is to report a summary of a company's revenues, expenses, gains, losses, and the resulting net income that occurred during a year, quarter, or other period of time.
Benchmarking lets an organization
know where it stands competitively in its industry.
The capacity of a restaurant like Charleston's would be the
maximum number of customers who can be effectively served at any one particular time.
Mason Structures Inc. purchases cement, steel rods, and wooden panels to use in the construction of buildings, houses, and bridges. These inputs are considered as ________ inventory for a construction business.
raw materials
Materials that have been purchased to be used as inputs in making other products are included in ________ inventory.
raw materials
Accounting refers to the process of
recording, measuring, and interpreting financial information.
INPUTS
resources such as money, labor, materials and energy that are converted into outputs
role of operations
responsible for managing the process of creation of goods and services. It involves planning, organizing, coordinating, and controlling all the resources needed to produce a company's goods and services.
An accounting term that is interchangeable with revenue is
sales.
revenue
the income that a business has from its normal business activities, usually from the sale of goods and services to customers.
CAPACITY
the maximum load that an organizational unit can carry or operate.
expense
the money spent, or costs incurred, by a business in their effort to generate revenues.
QAULITY CONTROL
the process of setting standards and testing to make sure something, like a product or service, is done correctly.
In which of the following scenarios is a business least likely to survive?
when a business focuses only on customer satisfaction and not on its own objectives, such as boosting productivity
A company's assets include its liabilities.
False
In a balance sheet, assets may exceed liabilities plus owners' equity.
False
Net income is the amount on which a firm will pay taxes
False
Return on assets and return on equity are examples of ________ ratios.
profitability
Studies have found a direct relationship between social responsibility and ________ in business.
profitability
________ refers to money owed to a company by its clients or customers who have promised to pay for the products at a later date.
Accounts receivable
Balance sheet
Balance sheet accounts are used to sort and store transactions involving a company's assets, liabilities, and owner's or stockholders' equity.
Which of the following statements is true of bookkeeping?
Bookkeeping is much more mechanical than accounting.
________ are the funds used to acquire the natural and human resources needed to provide products.
Capital resources
Which of the following scenarios reflects the capital-intensive nature of a manufacturer?
Coffee at Home mass produces coffee makers with multiple settings, so customers can choose whether they want to brew a cup, two cups, or an entire pot using the same machine.
Which of the following is true of the transformation process in operations management?
It is the conversion of resources, such as labor, money, materials, and energy, into goods, services, or ideas.
net income
NI is equal to net earnings (profit) calculated as sales less cost of goods sold, selling, general and administrative expenses, operating expenses, depreciation, interest, taxes and other expenses. ... Net income also refers to an individual's income after taking taxes and deductions into account.
________ is the primary goal of business.
Profit
OUTPUTS
The goods, services and ideas that result from the conversion of inputs
An income statement is the same thing as a profit and loss statement.
True
Ian got a loan from the Small Business Administration to start his own house contracting business. For Ian, this loan is
a liability.
benchmarking
a way of measuring your performance against similar-sized businesses in your industry.
An income statement shows
an organization's profitability over a period of time.
A crafts store displays various types of paper, stickers, glue sticks, yarn, canvases, paints, and other craft supplies on shelves. These items are examples of the company's
assets
The ________ presents a snapshot of an organization's financial position at a given moment.
balance sheet
Mario Autos Inc. measures and evaluates the quality of its cars and services against the market leaders in the automobile industry. Wherever there is a gap, Mario Autos Inc. tries to cover that gap by imitating the best practices of these market leaders. This is known as
benchmarking.
difference between accounting and bookkeeping
bookkeeping is responsible for the recording of financial transactions whereas accounting is responsible for interpreting, classifying, analyzing, reporting, and summarizing the financial data.
A hospital can effectively handle a maximum number of 300 patients at any one particular time. This is referred to as its
capacity.
Nonbusiness entities typically obtain revenue through
donations
gross income
earned by an individual on a paycheck before taxes and other deductions.
Cole owns a large chain of grocery stores. A significant part of his job is determining the amount of income left after taxes and whether the company will retain this income or pay it out in dividends to its stockholders. The income in this scenario is ________ income.
net
depreciation
of allocating the cost of a tangible asset over its useful life and is used to account for declines in value. Businesses depreciate long-term assets for both tax and accounting purposes.
For manufacturers, measuring productivity is fairly straightforward because
of the tangibility of their output.
The output of service providers must be consumed immediately, and only a few services can be saved, stored, resold, or returned. Which characteristic feature of services does this best illustrate?
perishability of outputs
Quality control refers to the
processes an organization uses to maintain its established quality standards.
The outcomes of a business's efforts are
products.
The financial statement that explains how a firm's cash changed from the beginning of the accounting period to the end is called the
statement of cash flows
inventory
stock, goods, merchandise. It's those assets, those products, those things of value, that you either buy from another or make yourself, that you then sell on to someone else (at a higher price than what it cost you to buy or make the inventory).
