1.03 classify businesses objective 1.03 classify businesses as profit- making or non profit-making;...
DESCRIPTION
Non Profit-making Businesses Can earn a profit, but cannot be run for the sole purpose of earning a profit; profits must be used to benefit the purpose of the organization, pay employees, etc. Can earn a profit, but cannot be run for the sole purpose of earning a profit; profits must be used to benefit the purpose of the organization, pay employees, etc. Are tax exempt Are tax exempt Cannot be run for the financial gain of the members or directors Cannot be run for the financial gain of the members or directors Donors’ Contributions are tax deductible Donors’ Contributions are tax deductible Examples Examples American Red Cross American Red Cross Salvation Army Salvation Army Meals on Wheels Meals on Wheels Homeless Shelters Homeless Shelters St. Jude’s Children’s Hospital St. Jude’s Children’s HospitalTRANSCRIPT
1.03 Classify Businesses1.03 Classify BusinessesObjective 1.03 Classify businesses as Objective 1.03 Classify businesses as profit-making or non profit-making; and profit-making or non profit-making; and service, product or combination.service, product or combination.
Profit-making BusinessesProfit-making Businesses For-profit businessesFor-profit businesses Motive is making a profit (earning more Motive is making a profit (earning more
revenue than expenses)revenue than expenses) Produce and distribute goods and services Produce and distribute goods and services
based on consumer demand for wantsbased on consumer demand for wants ExamplesExamples
Apple ComputerApple Computer SonySony Domino’s PizzaDomino’s Pizza The GapThe Gap Abercrombie and FitchAbercrombie and Fitch
Non Profit-making Non Profit-making BusinessesBusinesses
Can earn a profit, but cannot be run for the Can earn a profit, but cannot be run for the sole purpose of earning a profit; profits sole purpose of earning a profit; profits must be used to benefit the purpose of the must be used to benefit the purpose of the organization, pay employees, etc.organization, pay employees, etc.
Are tax exemptAre tax exempt Cannot be run for the financial gain of the Cannot be run for the financial gain of the
members or directorsmembers or directors Donors’ Contributions are tax deductibleDonors’ Contributions are tax deductible ExamplesExamples
American Red CrossAmerican Red Cross Salvation ArmySalvation Army Meals on WheelsMeals on Wheels Homeless SheltersHomeless Shelters St. Jude’s Children’s HospitalSt. Jude’s Children’s Hospital
Service BusinessesService Businesses Provide services rather than goodsProvide services rather than goods Some service businesses meet needs Some service businesses meet needs
(medical clinics, law firms)(medical clinics, law firms) Some service businesses provide wants Some service businesses provide wants
(taxi companies, ISPs)(taxi companies, ISPs) ExamplesExamples
Barber shopBarber shop Dry CleanersDry Cleaners Copy and Print Shops (Kinko’s)Copy and Print Shops (Kinko’s) Car repair shopsCar repair shops
Product BusinessesProduct Businesses
Sell goods to consumers and other Sell goods to consumers and other businessesbusinesses
Retailers and distributors are product Retailers and distributors are product businessesbusinesses
ExamplesExamples Old NavyOld Navy CD StoresCD Stores Best BuyBest Buy Dick’s Sporting GoodsDick’s Sporting Goods
Combination Product and Combination Product and ServiceService
Some businesses are both product Some businesses are both product and service businesses—they sell a and service businesses—they sell a product and provide a service.product and provide a service.
ExamplesExamples Automobile dealershipsAutomobile dealerships Appliance storesAppliance stores Can you think of others?Can you think of others?