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Name: Suliman Mohammed Salem AL Quwaitei

ID :2781281
Introduction to Business
*Business==> the state of always being busy and the hard work to get

*Activities of business:

1-Econmic ==>are those by which we can earn our livelihood.


-A worker work in the Factory.

- A manager work in the office.

- A doctor a operating in his clinic.

- A teacher teach in the school.

1-Non-econmic ==>are those performed out the love…


-Helping the people to build Houses.

-Give the people food(rice and meet).

- Giving charity Helping a blind person to cross the road.

*the Role of business in society:

 Want of the society.

 Provides jobs for the society.
 Buy tax to the Government.
 Reinvest your gain build new business.
 Expand existing business.

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281
*Objectives of Business:

 Profit motive.
 Service motive.
 Friendly relation with employees.
 To a chive time and effort.
 To get economies of large-scale production.
 To increase market share.
 To provide public service.
 Care for Environment and Society.

*Classification of Business:

 Profit making organization Vs Nonprofit making organization

 Good producing Vs services providing
*Components of Business:
 Name ==>important to identifying particular type of business
 Nature of business==>small, medium, large size
 People==>without help the people cannot run the business
 Set of objective==>help the people
 Physical asset==> without the land, building and computers
cannot run the business
 An organization structure==>it came with the group of people
 Culture or set of value ==>each one should respect other culture
and your product should be use apple in environment
 A system of communication==>it is relate in communication skills
like oral, writing, formal, informal and so on
 A recording systems==>how they are doing the business
 Procedure and system==>terms, condition ,rules and regulation
 Specialized function==>in attending telephonic and sending and
receiving mail every day
 Control system==>few do a mistake the control say directly this
wrong and tell you how to do the work

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281

*Organization==> group of people working together for something and

Coordination of the different department.

*Business organization==> It is a group of people organized to

accomplish business objective and goals.

*Character of business organization:

Characters Explain
* Objective==> Specific short range or aim, It is measurable
Objective and goals * Goals==> broad long range or aim, cannot be measurable

Resources Men, Money, Material, Methods, Market

Organization structure Framework enabling managers to divide responsibilities
Divide the work together, each one have separate work,
Division of labor each one have responsible of his work

Providing goods or You can getting the benefit and many services,
services advantages, positive things.
Substitution of You can find many resources.
Ownership As cure ownership for whatever you have, no one can take
your business

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281
Introduction to Business

Function of business:

1. Production==> is the operations of the products such as

range of product and design tools to help make the
products good. Also storage the products and make plan

2. Purchase==> it is Purchase of raw materials form the right

supplier at right price in right time and right quality. Also
controls stock and find the best source of supplier.

3. Finance and Accounting==> it is the responsible of the

financial and budgets and make report about the
financial of the company and buy tax for government.

4. Marketing==> responsibility for advertising for the

products and build relation with the customers and good
selling for the products and marketing of the product
and the company.

5. Human Resource==> It is responsible for employment of

staff and training programmers to improve employees
performance and relation with worker.

6. Research and Development==> It is designs and test new

products, improves and updates exiting products. Also
works with production department to develop models.

7. General administration==> the day to day administration of

the company offices involving mail, typing work and
attending telephonic calls.

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281

Introduction to Business
*Forms of business organization:

1) Sole Trader

2) Partnership

3) Companies

 public limited

 private limited

 limited liability companies

4) Co-operative society==>"only for helping the people".

1) Sole Trader:


-oldest form of organization.

-simple and easy to start

-can be started by any one person.


 Single owner

 Business is small

 Capital is small

 Simple and easy to start and close

 No separate law

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281
 Quick decision

 Unlimited liability

C) Advantage:

 Low cost to start

 Minimum regulation

 Direct control of business

 Owner receives all profit

D) Disadvantage:

 Unlimited liability

 Lack of continuity

 Difficult in raising capital

 Responsible for all decisions

2) Partnership:


-It they work together with a few to earn profit.

-People who has similar skills generally to business together.

-It is formed by an agreement===>"Doctors, Lawyers".

-It is a business owned and operated by two or more person under a

volunteer legal association.


 Number of partner is limited to 20.

 Capital is more than sole Trader

 Size is bigger than sole Trader

 Easy to start and close

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281
 Division of labor

 Unlimited liability

 Based on good faith

 Profit and loss is either shared equally or according to ratio

C) Advantage:

 Easy to start and close

 Business problem can be discussed in meeting

 Shared management

 Added capital sources

 Low cost to start

 Possible tax advantages

D) Disadvantage:

 Unlimited liability

 Lack of continuity

 Difficult in raising additional capital

 Difficult to find suitable partner

 Shared management

*similarities of sale Trader and Partnership:

 Easy to start and close

 Unlimited liability

 Low cost to start

 No permanent existence

 Small size

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281
 Flexibility

 No legal formalities

 Ownership and control

 Minimum Regulation

*The different between sole Trader and Partnership:

1-Number of people==> in Partnership is limited to 20 but in Sole

Trader is one "owner".

2-Capital==> in Sole Trader it receives to owner but in Partnership it

receives for all partner.

3-The responsible==> all Partner responsible but in Sole trader only the
owner responsible.

4-Division of work==> all the partner work together but in Sole Trader
the owner only work.

5-The economic==> in Partnership is storing but in Sole Trader is weak.

6-The ownership and control==>in Partnership it with the Partners but

in Sole Trader it with owner.

3) Companies:


-A company is a separate legal body owned by shareholder and run

by directors.

-The company can sell their shares to raise finance.

-The shareholder have limited liability.

-They are not personally liable for business debts.

-The liability of shareholder is limited to his\her investment.

-Number of legal formalities are more to start a company.

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281

 Minimum number of Shareholder is 2

 Liability of the Shareholder is limited

 Separate legal entity for business

 Profit is either distributed as dividend or it is retained in the

business for further development

 Formation is difficult because of number of legal formalities

 Compulsory Registration

C) Advantage:

 Limited liability

 Management can specialize

 Transferable ownership

 Continuous existence

 Legal entity

 Easier to raise capital

 potential

D) Disadvantage:

 closely regulated

 Most expensive form to organize

 Extensive record keeping is organize

 Double taxation(company Shareholder)

 Restrictions to form

Name: Suliman Mohammed Salem AL Quwaitei
ID :2781281
*Certificate of incorporation==>After going through the documents,
the Ministry may issue the certificate of incorporation, which is the
birth certificate of the company

*Memorandum Association:

-It contains the fundamental conditions upon which the company

is allowed to be registered.

-It defines the scope of the activities of the company to be


-It contains name, location, share capital and objective.

*Articles of Association:

-It is another important document

-These are the rules book of the company governing the conduct
of directors calling of meeting and other administrative matters.

E) Types of companies:

 Private limited companies

 Public limited companies

 Limited liability company

1) Private limited companies:

a. They are like a family business(shareholder are family


b. Business is usually small or medium sized

c. They are not allowed to offer shares to the general public

d. They cannot sell their shares without the agreement of


e. Minimum 2, Maximum 50

f. There is no need to hold any official meeting((‫))يتبع‬