UNIDAD EDUCATIVA BILINGUE DELTA BUSINESS & MANAGEMENT Adriana Plaza L. II Bach.

A 15/ 4/ 2013 AUTONOMOUS LEARNING GUIDE SECTION A Define the following terms: a) Opportunity Cost: Refers to cost measured in terms of the best alternative that is foregone when a choice is made. b) Franchise: Refers to an agreement between a franchisor selling its rights to other businesses to allow them to sell products under its name in return for a fee and royalty payments c) Sole Trader: refers to a self-employed person. He or she runs the business on their own and has sole responsibility for its success or failure. d) Shareholder: Are the owners of a company. Shares in a company can be held by individuals and other organizations. e) Stakeholder: Are individuals or organizations that have a direct interest in the activities and performance of a business. f) Mission Statement: Tends to be a simple declaration if the underlying purpose of an organizations existence and its core values. g) Revenue: The money earned from selling the products. h) Inflation: Occurs when the general price level in an economy continuously rises. It is measured by changes in the cost a representative basket of products purchased by the average household i) Economies of Scale: Refers to lower average costs of production as a firm operates on a larger scale. j) Profit: Positive difference between revenues and total cost.

SECTION B I. Read the case study and answer the questions that follow. 1. Define the term Secondary sector Secondary sector: is the section of the economy where businesses activity is concerned with the construction and manufacturing of products. - In the case study the secondary sector is the textile factory because they are the ones manufacturing the products for the consumers. 2. Discuss two possible areas of conflict between stakeholders in the Alumbre Project The two different areas of conflict can be: - In the Alumbre project the owners will loose their major source of energy, this means they will have to find a new way to get energy for their factory, till they found it they will loose a lot of time and their business will be affected. - In Peru the alumbre project fail so they will no longer be able to protect the environment, this means they will pollute the environment because, maybe the new energy source will not be so good for the environment. 3. Prepared a PEST analisys fot textile factory in Alumbre. PEST ANALISYS Political - The textile factory would be meeting every environmental law abput pollution, there will be no problems with the governments laws about pollution - The entrance of the machinery will take a lot a of time because the government need to approve everything, so the textile factory will loose work time. Economic - As Ecosoluciones is a non-profit organization, the taxes will be low in the textile factory. - They do not need to worry about the maintenance of the machinery because part of the trade is that ecosoluciones will be taking care of all the machines. - The textile factory needs find a great body of shops to sell their close to and be punctual in the delivery of the product. Technological - They need to find a way of producing faster by improving the machinery also they depend of the new source of energy, if it get damage they will not have any energy resource. - The textile factory will have a high production standard with the new production technology.

Social - The textile factory will produce clothe for every class of people, I mean everyone can pay for it. - They will distribute their product for different sectors around the country.

4. Contrast the objectives of non-profit organizations such as Ecosoluciones to those of profit-based organizations. Profit-based organization have a major objective which is to make a profit and for the owner, make their business grow so he will earn more. There are three different types of profit-based businesses such as sole traders, partnerships and limited liability companies. The non-profit organizations is totally different

because is an establishment run in a business-like manner but without profit being the major objective. In the profit based organization the profit reward that is distribute to its owners or investors in return for risking their money and time in the business but in non-profit organizations return this surplus back into the business. II. Read the case study and answer the questions: 5. Describe one disadvantage to Zesty of being a partnership - In partnership the lack of community might still exist if a partner dies or leaves the firm. This is because the original partnership deed may become invalid, so the partnership has to be set up again. In this case study, Zesty is a family owned partnership, if one important member of the family back down or dies all the business has to be set again, that is a disadvantage because they depend of each other to make the business work.

6. Distinguish between strategic objectives and operational objectives. A tactical objective is short-term ones that affect a division of the organization. They are specific goals that guide the daily functioning of certain operations, in Zesty case study an tactical objective can be that the department of maintenance have the orange in a good environment so they would last longer and in better conditions. The strategic objective are the longer-term goals of a business, for example, profit maximization, growth, etc. In Zesty is for example growing by making a new product, orange juicy. 7. To what extent is: - A 50% smaller crop in brazil is an opportunity for Zesty? A 50% smaller crop in brazil is an opportunity for Zesty because it open the market, is a way of growth. They are making a product diversification, and they are improving. - An appreciation in the value of the us dollar is a threat to Zesty? An appreciation in the value of the us dollar is a threat to Zesty because as they export they product, if the US dollar is higher, the cost for the customers will be higher too, so for Zesty, get the trade will be more difficult.

SECTION C Accounting: 1. Use the following personal data for James to calculate his net worth on June, 2012 Bank Account balance Electronic Equipment DVD collection Motor Bike Money owned to him Money owned by him Clothes Computer $185[asset] $1800[asset] $225[asset] $1200[asset] $100[asset] $650[liability] $1000[asset] $740[asset]

Assets Liabilities= Jamess Net worth Assets= 5250 Liabilities= 650 5250-650= 4600 JAMESS NET WORTH= $4600

2. Grace has $23.000 in assets and $13.200 in liabilities. If Grace used $3.000 of the cash to pay of her back load, how would it impact her owners equity? Use the basic accounting equation to illustrate your answer.

Assets

Liabilities

Owners Equity

$23,000

$13.200

$23,000 - $13.200= $9.800

$23.000

$13.200

$9.800

$13.200 + $9.800= $23.200

3. Classify each of the following as either an asset (A), liability (L), or owners equity (OE) account. Cash A

Account Payable Partner #1s share in

the business OE

Truck

Mortgage

Accounts Receivable

Supplies

Land

Back loan Partner #2s share in the business

OE