Some Business Studies Notes

This is by no means all of the business studies course, but there are some notes in here which I printed out which helped me a lot with my confidence for business studies.... so I hope it helps someone else :)

Topics covered: Factors of production, opportunity cost, public/private sector, primary/secondary/tertiary sectors, measuring businesses, business growth, business objectives, break even, Trading, profit and loss account, balance sheet, organisation structures, communication, market segmentation, product life cycle, motivation, industrial action, buffer stock.

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  • Created on: 09-06-09 16:06
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Factors of Production:

Land: All natural resources provided by nature such as fields,
forests, oil, gas, metals and other mineral resources
Labour: The people who are used produce goods and services.
Capital: Finance, machinery and equipments needed to produce
goods and services.
Enterprise: The skill and risk taking ability of…

Page 2

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Primary ­ extraction of raw materials

Secondary ­ manufacturing of products

Tertiary ­ providing a service

Measuring size of businesses:

The number of employees:
The amount of capital invested:
The sales turnover:
Market capitalisation:
Market share

Business Growth
Many businesses have an objective and that is to grow in size.…

Page 3

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Providing a service
Increase added value?

Total cost= fixed cost + variable cost
Revenue = Quantity sold x Price

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Contribution is the excess of price over variable costs. Any money
received over the variable costs makes a contribution towards the fixed
Contribution per unit = Selling price per unit ­ Variable cost per unit

Break even= Fixed cost/contribution per unit

Page 5

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Business documents:

Trading Account
The trading account reveals the gross profit of the business.

Profit and loss account
This account shows the net profit of the business.
Net profit = (Gross Profit ­ Expenses and Overheads) + Income from
non trading activities
Appropriation account is that part of the profit…

Page 6

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Balance Sheet
Balance sheet shows the value of a business's assets and liabilities on a
particular date.
It records what the firm owns (assets), what it owes (liabilities), what it
is owed and how it is financed (owner's equity).

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Types of Organisation Structure
Line Organisation

Functional Organisation


Page 8

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Market segmentation:

Disposable income

Page 9

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Page 10

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Types of Industrial Actions

Strike: when employees refuse to work
Picketing: When employees stand outside the workplace and
prevent the smooth functioning of the firm. E.g. they may stop the
movement of Lorries in and out of factory.
Work to Rule: It is when workers purposely follow all the rules…


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