business terminology

asset
something which a business owns e.g. cash, buildings, vehicles, stock, accounts receivable
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audit
the process of comparing the records within a business to identity errors or omissions. this detective method of internal control
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authority
this describes the ability of individuals within a business to make decisions or manage other employees
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autocratic
managers making decisions without any consultation with staff
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batch production
the manufacture of a limited number of identical products
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break even production
the manufacture of a limited number of identical products
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break even points
total variable and fixed costs are compared with sales revenue in order to determine the level of sales volume or production at which the business makes neither a profit or loss
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budget
a budget is a financial plan for the future, a budget forecasts future earnings and future spending, usually over 12 month period
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business expansion
growing the size of a business either internally or externally
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capacity
the maximum amount of output a business can produce with available resources
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capacity utilisation
a measure of the use of productive capacity within a business in a time period. calculated by working out actual output/maximum output x 100
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cash flow
the measure of financial inflows and outflows of the business
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centralised
all major decisions are made by either one person or a few senior staff
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chain of command
this is the number of levels in an organisation structure, the vertical line of authority
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corporate social responsibility
considering the welfare of all stakeholders when it decisions are made
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costs of goods sold
the cost to the business of buying in the goods it has sold
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culture
values and norms of an organisation
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decentralised
decision making authority is shared out to other staff to empower them. usually seen on flatter structure
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delegation
handing responsibility to an employee down down the organisation structure
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democratic
managers allowing staff to make some decisions but still maintain control
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diseconomies of scale
factors that lead to an increase in unit costs
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diversification
when a firm takes over another firm in an unrelated industry. they do this to spread the risk of business failure
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economies of scale
the reduction in long run average costs as a result of expanding the scale of production
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efficiency
how effectively a business is using its resources. measured by output per hour or per worker
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external growth
business growth achieved by taking over or merging with another business
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financial information
reporting and production of financial accounts so that users can have an accurate view of the firms financial position and can make informed decisions and plans
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flow/mass production
producing a large number of goods in a continuous process
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fraud
a deception deliberately practiced in order to secure unfair or unlawful again
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gross profit
the difference between the revenue from selling a good and the cost of buying it in
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horizontal integration
the merging of businesses which can produce the same product at the same stage of the production
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human resources
a responsibility of management e.g. managing staff, recruiting, training , appraising
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innovative culture
where a business environment encourages the creation of ideas to improve business performance
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inputs
materials which are transformed into output e.g. steel, wood
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intangible assets
assets that do not have a physical existence e.g goodwill, copyrights, trademarks, patents
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internal controls
measures implemented by an organisation to conduct its business in an orderly and efficient manner, safeguard its assets and resources, deter and detect errors, fraud, and theft
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job production
producing a particular good as a one off
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kaizen
workers meet regularly to improve efficiency and productivity in the production process
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laissez-faire
managers make few or no decisions
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layers of hierachy
number of ranks within an organisational structure
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lean production
is a production philosophy that considers and aims to reduce the wastage of resources in any aspects. the idea is that waste is a cost to the business. waste of time, waste of transport capacity, waste of detective products
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matrix organisational structure
individuals work across teams and projects as well as within their own department or function. eg. a project or task team established to develop a new product might include engineers and design specialists and those with marketing,production&finane
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merger
when two businesses agree to join their operations and become one single operation
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paternalistic
mangers making decisions after discussion with staff but have the final say
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power culture
where an individual or group of individuals dominate key decisions beyond their job function
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productivity
measurement of the efficiency with which a firm turns production inputs into output
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profit maximisation
the goal of most business firms. Profits can be maximised by increasing revenue and minimising costs
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quality circle
a part of kaizen, this is where employees work together in teams to seek out ways to continually improve the quality and productivity within the business
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separation of duties
the concept of having more than one person required to complete a task. in business the separation by sharing of more than one individual in one single task is an internal control intended to prevent fraud and error
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span of control
number of staff a manager is responsible for
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staff training
this is any transfer of knowledge or skills to the worker. can take place on the job or off-the-job. it is often costly for the business
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strong culture
where staff adopt the attitudes and values of an organisation and believe in the business
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subordinate
a person under authority or control within an organisation
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takeover
where a firm buys a controlling interest in another firm
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tangible assets
assets that have a physical form. tangible assets include both fixed assets, such as machinery, buildings and land, and current assets, such as inventory. the opposite of a tangible asset is an intangible asset
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Other cards in this set

Card 2

Front

the process of comparing the records within a business to identity errors or omissions. this detective method of internal control

Back

audit

Card 3

Front

this describes the ability of individuals within a business to make decisions or manage other employees

Back

Preview of the back of card 3

Card 4

Front

managers making decisions without any consultation with staff

Back

Preview of the back of card 4

Card 5

Front

the manufacture of a limited number of identical products

Back

Preview of the back of card 5
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