Business Management Unit 2 AOS 1

You don't have to register your business name if you

• Name the business after yourself

• Call the business by anything but your name

• Name the business after yourself and someone else

A business is not required to have work cover insurance if

• You have one employee

• You have multiple employees

• You are a sole trader with no employees

• You only have apprentices

GST is a

• Federal tax

• State tax

Local government controls

• PAYG and stamp duty

• Zoning, fire regulations, parking regulations

• Payroll taxes, pollution control, payment of employee superannuation

The separate entity principle states

• The business and owner should maintain the same bank account

• Is is easier to keep track of the businesses financial position if you keep personal and business transactions together

• Owners should always keep the transactions of the business and its owners separately

What factors should you consider when choosing a bank account?

• Bank fees

• Interest rates

• Convenience and support

• Overdraft facility

• Credit cards

Reason to use financial control systems

• They are tools that allow a business to accurately monitor and manage its financial performance

• They predict or estimate the business’s financial performance for a given period in the future

• Allows a business to keep track of outstanding invoices or payments that it has

• It is a process of testing and evaluating a business’s accounting processes and internal controls

Answer explanation

Budgeting - They predict or estimate the business’s financial performance for a given period in the future

Accounts receivable - Allows a business to keep track of outstanding invoices or payments that it has

Auditing - It is a process of testing and evaluating a business’s accounting processes and internal controls

Financial control systems that a business may use

• Overdraft facility, auditing, cashbook, inventory control, income statement

• Cashbook, income statement, balance sheet, accounts receivable, cash-flow management

• Auditing, cash-flow management, inventory control, budgeting, accounts receivable

What are record keeping strategies you can use

• Source documents, cash book, income statement, balance sheet

• Receipts, cash book, bank statement, passbook

• Recipes, income statement, passport, balance sheet

When choosing suppliers a business needs to consider

• Reliability, quality

• Sell-ability

• Price, proximity, CSR

• Quantity, globalisation