Task 2. Match each of the words or phrases on the left to an appropriate definition.

The Concept of Business

Task 1. Complete the text with the words in the box.

LESSON 5

1. distribution	5. Sale	9. expenses	13. concept	17. surplus
2. activities	6. Traditionally	10. goal	14. partnership	18. Services
3. Goods	7. company	11. shares	15. Business	19. creation
4. exchange	8. agreement	12. production	16. corporation	20. profit

Business is a word that is commonly used in many languages. (1), business simply meant (2) or trade for things people wanted or needed. Nowadays, the (3) and activities of business have increased. One definition of business is production, distribution, and sale of goods or services for a (4). To examine this defini­tion, let us look at its different parts.

First, (5) is the creation of services or process­ing of materials into products. One example is the conver­sion of iron ore into metal car parts. Next, these products need to be moved from the plant to the marketplace. This is known as (6). A car might be moved from a plant in Germany to a car dealership in Poland. Third is the sale of goods and services. (7) is the exchange of a product or service for money. A car is sold to someone in exchange for money.

(8) are products that people either need or want; for example, cars can be classified as goods. (9), on the other hand, are activities that a person or group perform for another person or organization. For example, an auto mechanic performs a service when he repairs a car. A barber renders a service when he cuts your hair.

(10), then, is a combination of all these (11): pro­duction, distribution, and sale. However, there is another im­portant factor, i.e., (12) of profit or economic surplus. A major goal in the functioning of any business (13) is making a profit. Profit is the money that remains after all the (14) are paid. Creating an economic

(15) or profit is, therefore, a primary (16) of business activity.

The three traditional forms of business are the sole proprietorship, the partnership, and the. corporation. The sole proprietorship means going into business for oneself. All one needs is some knowledge about the business, start up capital and knowledge of regulations. The (17) is an association of two or more people involved in business under a written partnership (18). The (19) is the legal entity having a right to issue stock certificates. The people who own such stock certificates (or (20)) are called stockholders/ shareholders. They in fact own the corporation.

1. Planning	a) Ann’s duty is to be sure that no mistakes were made in posting journal entries into the general ledger
2. Budgeting	b) In his report to top management the finance manager utlined the effect of the new accounting system in recording and posting financial entries
3. Obtaining funds	c) Finance manager decided to include money for a new personal computer in the operating budget
4. Controlling funds	d) Then his plant developed a long-term strategy of automating its production facilities, which would cost millions of hryvnias
5. Collecting funds	e) Having compared Balance sheets of 2 companies financial manager offered to delay investing his company’s money into their production
6. Auditing	f) A company has a lot of bad debts, so finance manager developed a more effective system to collect accounts receivable
7. Managing taxes	g) Finance manager designed a very good strategy to minimize the tax paid by his company
8. Advising top management	h) To increase its output the plant borrowed a short-term loan and bought the inventory needed for production

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