04 1st Semester Final Exam Review Name: Michael Piper

Company Information – Provide the following information:
Company website: http://geneva304.wix.com/area-304
Company E-mail address: area304.il@veinternational.org
Area 304 Slogan: Dream Big. Dream Worldwide.
Organizational Chart – How are we structured? We use a hierarchical organizational chart, which means that every employee is grouped by department, and each employee has a supervisor.
Form of business organization: We are a C-Corporation.
Purpose of employee orientation: It provides employees the opportunity to get acclimated to their positions and their role in the firm.
What is included in employee personnel files: Evaluations, raises, disciplinary actions and commendations.
Business Knowledge
How does the US Wholesale Marketplace work? Distributors buy products from a manufacturer, then they sell the product to retailers.
How do US savings accounts work? Interest can be earned on any money that is stored. Different banks pay different rates, and interest is also compounded differently from bank to bank.
What is FDIC insurance and how does it work? The FDIC is a United States government agency that preserves confidence in banks by insuring money deposited into those banks (up to a certain point).
What are CD’s (Certificates of Deposit)? These are certificates issued by banks to people who deposit money.
What are IRA’s? This stands for Individual Retirement Account. It is a good way to save money for retirement due to the large tax breaks that are offered.
Explain each of the following types of businesses:
Manufacturing: Manufacturers use raw materials to make goods, and then they sell them to distributors.
Wholesale: Wholesalers buy bulk amounts of products from manufacturers and sell them to retailers.
Retail: Retailers sell directly to consumers.
Explain the format. Purpose and usage of each of the following:
A business letter: A business letter is a formal letter that has to include a full address with name, the date, inside address, a salutation, a body paragraph, and a closer. Business letters are intended to get the recipient to respond. A memo: An informal letter that includes to, from, date and whatever the subject is. A letterhead is also needed. Memos are usually used to communicate within a company. An agenda: An agenda includes meeting information, items on the agenda, and preparation for the meeting. Agendas are used for meetings.
Meeting minutes: Notes taken during a meeting to keep track of the things that were discussed during the meeting.
Taxes and Compensation
Define the following:
Gross Pay: The total amount of money that a person makes before taxes.
Net Pay: Gross pay minus deductions.
Disposable Income: Personal income after taxes.
Discretionary Income: The money that is left over after deductions/taxes and after all bills have been paid.
Taxable Income: The amount of income that is used to determine income taxes.
Define types of compensation: Wage: Payments computed on a hourly, daily or weekly income. Salary: A wage typically paid on a weekly or biweekly basis, which usually adds up to a set amount for the whole year. Bonus: A gratuity given as a gift, usually due to good performance. Commission: A fee given for executing a commercial transaction. Overtime pay: Work performed by an employee in excess of the regular workday, usually over 40 hours a week.
Define types of deductions from a paycheck: Federal Income Tax and how percentages are determined: Percentages are determined by how much income a person makes each year, as well as exemptions. State Income Tax and the percentage amount: State income taxes have different sets of deductions and credits that can be granted in certain situations. Medicare and the percentage amount: A federal health insurance program for people over 65. The deduction for this is 1.45%. Social Security and the percentage amount: A federal insurance program that provides benefits to retired people. The deduction is 6.2%.
Tax Forms
Explain the following forms, including their purpose, what information each form provides and when they must be completed or received:
W-2: This form shows the amount that is withheld from a person’s paycheck. Employers must send these out by January 31st.
W-4: This must be completed by the employee. This tells the employer how much to withhold from a paycheck. This is completed when a person gets hired.
1040EZ: This is a tax for for people under 65 who have no dependents and make under $100,000 a year.
1040: This is a tax form for people making over $100,000 a year, people who made money for stocks, as well as many other exceptions.
Business Plan What is the purpose of a business plan? To have a plan for the company and to gain the interest of investors. What are the parts of the business plan? Executive Summary, Marketing Mix, and Finances Why is a business plan needed and how is it used? It is used as a plan for the design company as well as an advertising tool. What items are considered when determining start-up costs? Spending on assets and expenses. What is the purpose of an organizational chart? It is used to show the chain of command What is the purpose of the SWOT Analysis? To determine strengths and weaknesses, both internal and external. How is the SWOT Analysis used in a business plan? To determine the strengths and weaknesses of a company.
Types of Business Ownership
Define the following, explaining 1) the type of liability, 2) the advantages and 3) the disadvantages: Sole-proprietorship This is a business owned by one person. This person holds unlimited liability. This person also stands to make all of the profit, but also to take all of the losses. Partnership A business or firm owned and run by two or more people. The partners share all of the liability. These people stand to make much of the profit each, but to also deal with the losses. C-Corporation A corporation where profits are passed to owners. Everyone involved has limited liability. S-Corporation Corporations that pass all profits and losses to shareholders.
Trade Show
Explain the following types of promotion and provide an example of each: Advertising - Print and Broadcast: Paid advertisements in newspapers, radio shows, etc. A new restaurant in NYC pays to have a banner ad that they made in the New York Times. Sales Promotion: Offering lowered prices on certain goods and services to gain more customers. For example, 20% off of a TV at Best Buy. Public Relations: The professional maintenance of a company’s image. E.g. a company’s Facebook page Direct Mail: Mailing advertisements directly to consumers, such as mailing coupons. Personal Selling: Contact between a salesman and a customer. For example, a salesman convincing a customer to buy a phone.
What is the purpose of a trade show? To meet other people which you can sell goods to as well as buy goods from. Explain the 8 steps of a sale:
1. Preparation – research and planning on how to handle the sale
2. Greeting and introduction – Saying hello and introducing yourself as well as what you do.
3. Qualifying – Ask about the customer’s needs, what they want/need, and the logistics of that
4. Surveying – Who, what, why, when, where about the person, the company, etc
5. Handling objections – Handling any doubts they have to continue to entice them to buy your product.
6. Presentation – Prioritize their needs and talk about benefits to the customer
7. Closing – Get the customer to identify all concerns and questions, and then initiate the finishing of the sale
8. Customer maintenance – Thank you letters, continual assistance with any questions or concerns. Which types of promotion might we use at the Michigan Midwest trade show? – Impact marketing, sales promotions, personal selling
Product Evaluation How might we determine what products (areas) we are going to add to our product line? Products that are similar to successful products and all products that a large amount of customer request. How do we determine what products (apartments) we will eliminate from our product line? Products that are unprofitable or unpopular. How do we determine the pricing of our products? Basing the prices on the product’s real-world value, then adding a certain amount to make a profit. Why do most companies charge shipping? Because shipping products can be costly. What do we charge our customer’s for shipping? None, because our product doesn’t need to be shipped. What is the VEI sales tax rate? 7% What percentage of sales tax do we charge our customers in the VEI world? 0%
Purchasing
What is the difference between a purchase order and a sales invoice (and define each)? A purchase order is a commercial tool used for ordering goods from a supplier, and an invoice is a commercial tool indicating a payment for due goods that are sold. Once you make a personal purchase, when do you pay for the product? Once the invoice has been sent to the customer.
Department Responsibilities
List the general responsibilities of the following departments according to portal: Accounting & Finance: To manage the finances of the firm, as well as prepare financial statements. Administration: Controlling the management of an office or business. Human Resources: Human Resources hires, trains, and general administration. Marketing: Promoting and selling products. Sales & Purchasing: Buying and selling products as needed to finalize sales Which department takes attendance? HR Which department prepared the employee handbook? HR What is the purpose of an employee handbook? To give employees guidelines and rules for how they are expected to perform. What is a personnel file and what does it include? Evaluations, raises, disciplines, and commendations. Which department maintains the personnel files? HR What is a confidentiality agreement? A legally binding agreement to not disclose certain information. What is the purpose of an evaluation? To look at how an employee is performing Which department prepares the company newsletter? Administration
What are ways to increase productivity? To communicate with others and as for tasks so that you can always stay busy.

Document Design and Layout
Define:
Portrait layout: A vertically oriented document. Landscape layout: A horizontally oriented document. Header: A line or block of text appearing at the top of each page of a book or document. Footer: A line or block of text appearing at the foot of each page of a book or document.
Define:
Browser: A program to access websites. Hyperlink: A clickable link that will take a person to the website contained in the hyperlink. Attachment: Files that are transmitted to others, usually through email.
Financial Documents
Explain each of the following, including their purpose and what accounts are found in each: Income Statement: Shows a company’s revenues and expenses during a certain period. Balance Sheet: Assets, liability, and shareholder equity. Cash Flow: Cash moving in and out of a business.
VEI Information
Define and be able to explain how we use the following items: Data Portal: What allows VEI employees to view the firm’s bank account, their personal bank accounts, emails, reference documents, etc. VEC Bank: The bank that is in the VEI portal VEI Marketplace: Where sales & purchasing buys apartments to finalize sales. Sales Tax: A tax on all transactions that are conducted in VEI.