Business OCR Level 3 Unit 1

Retail customers - correct answer customers who buy finished products, e.g. frozen peas from a supermarket Business customers - correct answer businesses that purchase products or services from another business Unlimited liability - correct answer when the owners of a business are personally liable for all debts incurred by the business, if the business itself does not have the funds to repay them Limited Liability - correct answer when the owners of a business are liable for the debts incurred by the business only to the value of their investment in the business diseconomies of scale - correct answer when a business becomes too large the cost per unit may increase and the business may become more inefficient Business aims - correct answer a summary of what the business wants to achieve in the future Recession - correct answer a period of economic decline where demand and output fall Economies of scale - correct answer cost advantages gained when the size of a business increases, e.g. suppliers may offer discounts to those placing larger orders Unique selling point - correct answer a specific factor that makes a business stand out from its competitors Functional Area - correct answer a division of a business where employees have similar roles, skills and expertise, e.g. marketing function Statement of financial position - correct answer a summary statement on a particular date that shows a businesses assets, liabilities and owners equality Income statement - correct answer a financial statement that shows the revenue and expenses a business has received and paid over a period of time: the statement will show the profit the business has made during this time Cash flow forecasting - correct answer estimating the expected cash inflows and outflows for a period of time in the future to identify likely surpluses or shortages Pricing strategy - correct answer the method used to determine the price of a product /service taking into consideration the market, competitors pricing, customer incomes Disciplinary procedure - correct answer a specified process for dealing with alleged employee misconduct, e.g. poor performance Grievance procedure - correct answer a specified process for dealing with a complaint made by an employee about their treatment at work e.g. receiving lower pay than stated in contract Flat structure - correct answer a company structure containing few levels Hierarchical/ tall structure - correct answer a pyramid-shaped structure with many levels centralized structure - correct answer a structure where decision making is kept at the top of the hierarchy Decentralized structure - correct answer a structure where decision making is more spread out and filtered down the hierarchy Matrix structure - correct answer where employees are grouped by function and product/project Span of control - correct answer the number of subordinates a supervisor manages Accountability - correct answer the responsibility that someone has for actions that are carried out Opportunity cost - correct answer a benefit, profit or other advantage that must be given up to acquire or achieve something else Costs - correct answer the expenses a business incurs when producing and supplying products and services to customers Depreciation - correct answer the cost of an asset consumed over its useful life, e.g. due to wear and tear