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Past paper Practice

The document outlines various aspects of business operations, including the importance of financial and purchasing functions. It details the steps involved in the purchasing procedure and distinguishes between owned and borrowed capital. Additionally, it discusses the advantages and disadvantages of credit purchasing for businesses.

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19 views

Past paper Practice

The document outlines various aspects of business operations, including the importance of financial and purchasing functions. It details the steps involved in the purchasing procedure and distinguishes between owned and borrowed capital. Additionally, it discusses the advantages and disadvantages of credit purchasing for businesses.

Uploaded by

funkybore
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 6

SECTION A: COMPULSORY

1.1.1 D
1.1.2 D
1.1.3 C
1.1.4 C
1.1.5 B
1.2.1 Consumer Protection Act
1.2.2 Capital
1.2.3 Micro
1.2.4 Opportunity
1.2.5 Ombudsman

SECTION B

2.1 Norms
Beliefs
The way managers are addressed.
The way employees are addressed by managers.
2.2 The term Marco-environment refers to the study of the economy as a whole.
E.g., Inflation rates.

2.3.1 Vision = “SM wants to become a word-class manufacturing business.”


Strategy = “The management of SM first identify the needs of their
customers before they start producing their products.”
2.4.1 Physical environment = Materials may be scarce in which businesses
struggle to get access to them. E.g., A business needs raw material to produce
tables but they are not available.
Technological environment = Businesses would need to upgrade their machines in
order to keep up with the competition they are facing.
2.5 Businesses should keep their company image positive in order to gain
customer loyalty. They should incorporate quality in their products in order to
gain customer trust and satisfaction.

QUESTION 3: BUSINESS OPERATIONS

3.1 Grants
Bank Loan
3.2 Businesses will need finance in order to purchase the needed materials in the
purchasing function.
3.3.1 Top Management = “They have recently appointed Chris as the CEO”
Low Management = “Teddy was appointed as a supervisor”
3.4 The term quality is the ability to satisfy customers’ needs/wants.
3.5 Quality assurance = It is the inspection of products during and after the
production process to make sure the meet the specifications.
Quality Control = It the inspection of the final product to make sure it meets the
right expectations before it can be given to customers.
3.6 Quality ensures that customers will want to buy the businesses products for a
longer period with no complaints. It also ensures that the demand is sustained in
order to keep the business running.
QUESTION 6: BUSINESS OPERATIONS (BUSINESS FUNCTIONS)

Introduction
The financial function is responsible for managing all the cash
flows or finances of the business. While the purchasing function
manages the amount of stock needed in the company. This
essay will discuss the purpose of the financial function as well
as the procedures of the purchasing function.

Main Body

Purpose of the financial function


Financial function is a managing element in which all cash
transactions are recorded.
They make sure that all the recorded records are up to date.
They make informed decisions on weather or not the business
will be able to use the allocated capital for its operations.
This function is linked to the purchasing function for the money
needed to buy stock.

Steps in the purchasing procedure


Determine the need for a product
The purchasing function must decide weather the allocated
stock will be needed by the company at a later stage or during
the production.
Unwanted resources are not purchased if not stated on the
specifications. E.g. A teddy bear must be made with the fabrics
rather than cotton.

Choose a suitable supplier


The purchaser must choose a reliable supplier in which the
business will get the correct quantity of stock.
All stock must be delivered on time after selecting a supplier.
Stock must be in good condition. E.g., Supplier brings fresh
produced fruits.

Place the order


The purchaser must verify if they ordered the correct stock
needed.
Order of goods should be done on time to avoid stock
shortages.
Pay the supplier
The purchasing function should pay the supplier immediately
after goods are given.

This payment should be done in order to avoid charges from


the supplier.

Owned Capital
Capital owned by the business for its operations or long-term
use.
It is not a liability.

Borrowed Capital
Capital that is borrowed from another person or business and is
then repaid over a fixed period.
It is a liability.

Additional Part
Advantages
Credit purchasing is when the business purchases good on credit for a more
effective cash management or cash flow.
Businesses have a low risk of losing money when buying on credit.
They are able to purchase stock one time.

Disadvantages
They are at risk of getting fined more money if they do not pay the full amount.
Interest is charged when buying on credit.
There are certain rules or regulations that need to be followed in which the
business may not qualify to buy on credit.

Conclusion
Both the purchasing function and financial function play a crucial role in the
business in which materials and money for the supply is needed. Especially in
credit transactions where both functions are needed for smooth transactions and
stock management of the business.

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