EXPLORING THE WORLD OF BUSINESS

Glencoe Accounting and Mrs. Nichols

Key Terms

Free enterprise Profit Loss

Entrepreneur Capital Types of business

Service Merchandising Manufacturing

Types of Businesses Sole proprietorship Partnership

LLC

Corporation S. Corp

Big business logos!Can you think of some local businesses?

Business

Free Enterprise

We are free to produce goods and services.

We can use our money as we see fit Spend it Save it Donate it

Competition is key!

Free Enterprise

PROFIT

Money earned over and above the amount spent to keep the business operating

LOSS

Businesses that spend more money than they earn

Entrepreneur

Pros Cons Be your own boss You create opportunities

to earn money Decide your own

schedule and the hours you work

Choose the people you work with and for

You benefit from your hard work.

Will work long hours Lose security of steady

wages and medical benefits

Market your own products and services

Be motivated and energetic majority of the time

Risk losing money

A person who takes their ideas and starts a business by producing products or providing a service

Are you an Entrepreneur?

Speaking Writing Marketing Creative Mechanical Risk taker Accounting

knowledge

Self motivated Self starter Have a vision Great energy Imagination Computer skills

Consider owning your own business …Some skills you may need are

Types of Business Operations Capital – money that investors,

banks or business owners supply. Service Business – provides a needed

service for a fee. Merchandising Business – buys

finished products and resells them. Manufacturing Business – buys raw

materials, uses labor and machinery to transform them into finish products.

Forms of BusinessesSole proprietorship

Easy to set up All profits go to owner Owner has total control Few regulations to follow

Hard to raise money, owner has all the risks. Limited expertise and hard to attract talented employees.

Forms of BusinessesPartnership

Easy start up Pooled skills and talents More money available

Risk of partner conflict, shared profits, shared risks

Forms of Businesses

Corporation

Easier to raise money Easy to expand Easy to transfer ownership Losses limited to investment

More costs to start, more complex to organize, more regulations, higher taxes

Are you an Entrepreneur

Persistent Creative Responsible Inquisitive Goal-oriented Independent Demanding Self-confidence Risk-taking Restless

Rate yourself 5 to 1

5 being most like you, and 1 being least like you.