During the Business class throughout
the whole semester, I have learnt a lot from the lecture in class. There are
many different topics included in this subject, including the definition of
business and what business really is. All these topics are important for future
uses where we might set up a business.
My favourite topic from the lecture
is "Managing Employees". What interest me the most in the topic is
the 5 different needs that motivate human beings. The 5 needs are physiological
needs, safety needs, social needs, esteem needs and self actualisation needs. I
also learned about the "Big 5" personalities which are openness,
conscientiousness, extroversion, agreeableness and neuroticism. Before
employing someone to work for the company, the employer prefer a person to have
the "Big 5"personality traits.
The topic that I found useful in
everyday life is "Managing with Financial Information". I learned
what accounting is about. Accounting is basically to keep track of all the
transactions and summarizing those records into a report. Break-even analysis
is an important skill learned in this Business subject. Break-even is a state
where the revenue of the business is equal to its expenses. With this analysis,
we can set a minimum target to avoid losses.
By studying Introduction to
Business, I feel that I have gained a lot of knowledge from all the lecture
topics.
Photo In Class
Class Test
Business Charity Drive
Tutorial Exercise
Intro
to Business Exercise 2.0
- What
is a niche market? Can you give 2 examples (other than from the notes) of
a niche market? Why would a business want to target a niche market?
Niche market refers to very specific
or unique segments of a market. For example, wedding planner, Magazine SOHO and
stress management. This is because they serve as distributors of products for
the big business, act as suppliers and they are able to respond quickly to
changes in the market.
- What
are some of the reasons that motivate people to start their own business? If
you were to start a business, what would be your main reason? Discuss.
The reasons that motivate people to
start their own business because they like the idea of being self-employed
instead of working for others, to fulfill their personal dream and they believe
that they have a product with good profit potential and wants to take
advantages of the opportunity. If I were to start a business, my main realm
would be self-employed instead of working for the others.
- What
is limited liability? Is this an advantage or a disadvantage to the
business owner? How (i.e. illustrate with an example)?
Limited liability means an owner is
not personally responsible for the debts of his company. This is an advantage
to the business owner.
- What
is a franchise? Why would the parent company of a franchise choose to sell
licenses to franchisees instead of expanding their own chain of stores? Also,
provide 2 examples of a franchise.
Franchise is a business operating
under licenses issued by parent companies. For example, McDonald's restaurant,
SUBWAY and KFC. A franchise is easier to manage and there is no need to worry
about the business.
- Your
family has owned a business as a private company for the last 20 years.
Recently your father, the CEO and chairman, is rushing to take the company
public, but you sensed that he has not thought through this decision
properly. As his adviser, what reasons would you give to persuade to stay
as a private company?
If the company becomes public, the
shares cannot be sold. A private company allows the business to be controlled within
in the family. The owners are also fewer so we know them better.
- How
can internet help a recently-started small business?
Internet can spread news without
spending any money, that means free advertisement. The advertisement can be
spread worldwide or everywhere that has internet access. With the internet, it
is easy to have customers around the world. Business can be done at home where
you do not need a shop and pay rental for it.
- If
you are a banker and, Gabriel, a potential business owner wants to apply
for a loan for starting a business, under which circumstances would you be
more likely to lend – a) he wants to buy an existing business or b) he
wants to start a brand new business? Why?
He wants to buy an existing business
because if the existing business is already successful (ie. have a large
customer base, established relationship with suppliers and bankers,
profitable), then it would be less risky than starting a business from scratch.
- Discuss
(any) 2 pros and 2 cons of a partnership.
Pros:
-more capital due to more owners
-more capital due to more owners
-legal paperwork is simple and low
cost
Cons:
-unlimited liabilities
-arguments may arise if the owners do
not share the same business objectives
- What
are shares? Where are shares traded in
Share is a single unit of a ownership;
who owned a company/business. Bursa Malaysia is a share market where shares
traded in Malaysia. If a company earn more money, the shares will go up.
Intro to Business Exercise 7.0
1. What is accounting? Explain.
Accounting is an information system that records and summarizing these
transactions into a record to be read by business people, so that they can make
informed business decisions.
2. Lejun is the owner of an architectural firm but
he has no rudimentary knowledge in accounting (he has an accountant who looks
after everything for him). Is this acceptable? Why or why not?
Not acceptable, because he has to know basic about
accounting to ensure that his firm is in good condition or else he would be
cheated.
3. What information can you obtain from a Profit
and Loss Statement? How can you use this report to assist you in making
business decisions (use an example)? What is the other name of P&L
statement?
Profit & loss statement is to report the revenues,
expenses and profit/loss of a business during a period. For example, the usual
cost of a phone is RM800 each and Belle selling them for RM1200 each. The total
profit that she earned is RM400. The other name for P&L statement is income
statement.
4. What is a Balance Sheet? Also explain the 3 main
items reported in it (with suitable examples). What is the other name of
balance sheet?
Balance sheet, also called as statement of financial
position. It is a summary of the financial balances of a company or other
business balance. The 3 important elements are assets(Cash and cash
equivalents), liabilities(accounts payable) and ownership equity(per value of
shares).
5. What is the accounting equation (formula)? Shi
Yi started her business on 1st January 2011 with $1.5m of her own money and
$0.8m of bank loan. Write out the equation for her business.
Assets = Loan + Owner’s Equity/Capital
2.3m=0.8m+1.5m
6. Continuing from question 5, what if Shi Yi repaid half of the bank
loan 2 months later? How will her business’ accounting equation look like?
Lastly, at the end of 2011, her business makes 0.4m of profit. Again, how will
her accounting equation look like?
Asset = Liabilities + O/E
= 0.4m+1.5m = 1.9m
0.4m+1.9m=2.3m
7. Yin Jou wants to borrow $150,000 from Public Bank. She currently
has $250,000 of assets (car, shares and cash) and liabilities (e.g. personal
loans) of $226,500. Based on this information, would you (as a loan officer)
approve the loan? Why or why not?
No, because there is a high possibility that she might be cannot paid
back the loan. This is because the amount of liabilities she has is a lot more
than her Owner Equity.
8. Herman runs a roti canai stall in Subang. His monthly rent and
utility expenses are $2700. He sells each roti canai for $1.50 and it costs him
$0.65 to make each. Calculate his break-even point. Why is this information
important to him?
Break-Even Point = Fixed Cost/(Selling Price-Variable Cost)
= 2900/(1.50-0.65) = 3176 Roti
Canai per month
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