Objective 1 Vocabulary

PURPOSES OF BUSINESS

O ProfitO Money that remains after a business

has paid for the expenses of running the business.O Income > Expenses

Purposes of BusinessO Profit Motive

O A person's incentive to work to gain something for himself or herself (that is to make money).

Purposes of BusinessO Competition

O Contest between businesses to win customers ‘ business and loyalty

Purposes of BusinessO Needs

O Items necessary for existence, such as clothing, food, shelter

Purposes of BusinessO Wants

O Items that would be nice to have but are not necessary

Purposes of BusinessO Consumer

O A person who uses good or services.O Many times that consumer is also the

customer (purchaser)

Purposes of BusinessO Goods

O Items businesses sell that can be physically weighted or measured, such as iPODS and CDs

Purposes of BusinessO Services

O Tasks that businesses perform or provide for customers, such as hair cuts and car washes

Types of BusinessesO Sole Proprietorship

O A business owned by only one person.

Types of BusinessesO Partnership

O A business owned by two or more people

Types of BusinessesO Franchise

O A contract between a parent company and a franchisee to use the name and sell the goods or services of the parent company, such as KFC.

Types of BusinessesO Non-profit organization

O A business whose goal is to provide a service rather than to make a profit, such as the American Red Corss.

Types of BusinessesO Corporation

O A business considered separate from the owners of the business by law. The owners are the stockholders.

Types of BusinessesO Multinational corporation

O A company that does business and has business facilities in many countries, such as Coca-Cola.

Functions of a BusinessO Accounting

O The process of recording and reporting the financial data for a business

Functions of a BusinessO Management

O The process of leading and directing all or part of an organization.

Functions of a BusinessO Marketing

O The process of creating, promoting, and presenting a product to the consumers.

Functions of a BusinessO Information Technology

O The process of developing, installing and implementing computer information systems and applications. IT includes the support and maintenance of computer hardware and sfotware.

Functions of a BusinessO Operations

O The activities involved in the day-to-day running of a business for the purpose of producing value for the stakeholders.

Functions of a BusinessO Human Resources

O The activities that deal with the hiring, firing, training and other personnel (employee) issues.