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4th August 2015, 08:01 AM
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Basics of Business Management Calicut University
I am doing BBA from calicut university and as my examination are coming in next month so I am looking for syllabus of Basics of business management which part of my course , so can you here provide me???
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#2
4th August 2015, 10:54 AM
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Re: Basics of Business Management Calicut University
As you said you are student of calicut university and doing BBA from this university , for prpration of youer exam you need this time syllabus of Basics of business management paper so I have this syllabus in pdf and shairing with you: Business And Economic System Business is viewed as an organized economic activity arising at the production and sale of goods and services needed by the individuals in a society. The business system cannot be studied without reference to the economic system in which it has to function. An economic system consists of the institutions through which economic resources are utilized for satisfying needs of individuals in a society. The basic questions that have to be answered by an economic system are; 1. What commodities shall be produced and what quantities? 2. How shall the goods be produced? 3. For whom shall the goods be produced? Economic systems will answer these questions. Business activity and its organization will naturally depend upon the decisions made by the society on the above issues. The basic economic system fall under four categories; they are Capitalized or Free Market Economy Free market economic system or capitalist economic system is characterized by the following assumptions, 1. It is based on economic individualism. 2. Factors of production are privately owned. 3. Capital is privately owned and right to own and occupy private property. 4. Freedom of choice in respect of consumption, occupation, savings and investment. 5. Free market economy is not planned, controlled or regulated by the government. Basics of business management paper syllabus Mixed economy Mixed economy is characterized by the combination of both free market and centrally planned economy. Thus it lies in between capitalized and centrally planned economy where both public and private sector exists. In a mixed economy private enterprise is permitted to function and flourish subject to control and restrictions by the government. In mixed economies, several basic and strategic industries are owned and managed by the state. The state regulates the activities of the private sector so that it may serve the interest of the nation rather than its own interest. The states also regulate the monopolies and takes effective steps to reduce inequalities of income and wealth. The public sector functions as a socialist economy and the private sector as a free enterprise economy. Communism In communist economy the control of economic power rests in the state. Communism is the family of economic and political ideas and social movements related to the establishment of democratic, classless and stateless society based on common ownership and control of the means of production and property. Further, state operates with one party system and declares commitment to Marxism-Leninism. Under this type of economic system, means of production are socialized and private property is abolished with the objective of ending the exploitation of the poor by the rich. The government owns the economic resources and decides what is to be produced, how much is to be produced, for when its goods and services are to be produced and how these are to be distributed. Individuals in such an economy work not for private gain but for good of the society. In such an economy, the state is the only employer and the role of the individual is subordinate to that of the total population. It is expected that by eliminating the private freedom of choice and action and establishing the society based on the norm of each according to his ability, to each according to his need, the communist economic system would achieve the most desirable allocation of resources and would bring about equality of wealth and opportunity. Different Forms Of Business Organization Viewed from the angle of ownership, a business firm may be owned privately, or by the government, or be in the joint sector. The chart below illustrates the various form of business organizations. SOLE PROPERIETORSHIP An individual or sole proprietorship is a form of organization in which an individual introduces his own capital, applies his own intelligence and skills in the business and remains entitled to all the ensuing profit or losses thereon. As Peterson and plowman state, “a sole proprietorship has no legal existence apart from the proprietor himself. He is the firm”. Advantages The advantages of sole proprietorship includes the following: a) Easiness information; b) The owner’s complete control over the business; c) A direct motivation to work hard and succeed; d) Maintenance of absolute business secrecy; e) Possibility of quick and timely decisions; f) Personal contacts with employees, customers and others; Disadvantages The following may be listed as the disadvantages that an individual proprietorship would suffer from: Various forms of Business Organizations Joint enterprises Private enterprises Public enterprises Unincorporated Incorporated Sole proprietorship Hindu undivided family Partnership firm Private limited company Public limited company Cooperative society Unincorporated Incorporated Departmental undertaking Board organization Government company Public corporation a) Limited capital resources; b) Limited managerial ability or technical expertise; c) Limited avenues for diversification and growth; d) Limited personal liability for business losses; and e) Uncertain life and lack of continuity. Suitability An individual proprietorship is deemed to suitable in the following cases; a) Where only a small trade is involved; b) Where capital required is not much; c) Where risk involved is not for bidding; d) Where quick decisions are required; and e) Where personal supervision is merited. PARTNERSHIP A partnership has been defined by the Indian Contract Act as “the relationship which subsists between persons, who have agreed to combine their property, labouror skill in some business and to share the profits thereof between them.” The Indian Partnership Act, 1932 has defined partnership as follows: “partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.” W.R. spriegal notes that, “partnership has two or more members, each of whom is responsible for the partnership.” Characteristics of partnership Thus, persons who enter into a partnership are individually called the partners, collectively referred to as the partnership firm, and they conduct their business under a firm name. Essential characteristics of a partnership may be briefly outlined as follows: a) There should be two or more persons; b) An agreement must have been entered into; c) There must be a lawful business in existence; d) Sharing of profit or losses is to be done; e) Every partner is an agent of every other partner; f) The management is to be done; g) Every partner is an agent of every other partner; h) The management is to be collective; Partnership Deed Partnership deed is a document which contains the terms and conditions of partnership agreed by partners. A partnership is formed by an agreement .This agreement may be either written or oral. When the agreement is in writing, it is called partnership deed. If such a written agreement is made, future disputes between partners can be avoided Types of Partnership A partnership can be of two kinds, namely 1. General Partnership 2. Limited Partnership 1. General or Unlimited Partnership A partnership in which the liability of all the partners is unlimited is known as unlimited partnership. In such a case all the partners have the right to take part in the management of the firm. It can be of three types. a) Partnership at will – Partnership at will is a partnership which is formed to carry on business without specifying any period of time, and no provision is made as to when and how the partnership continues as long as the partners are willing. b) Particular Partnership – It is a partnership established for a stipulated period of time or for the completion of a specified venture. It automatically comes to an end with the expiry of stipulated period or when the specified venture is completed. c) Joint venture – A joint venture is a temporary partnership which is formed to complete a specific venture or job during a specified period of time. A joint venture may be set up to underwrite an issue of securities, to construct a building or for any other similar purpose. 2. Limited Partnership A limited partnership is one where there are two types of partners. They are limited partners and general partners. The liability of limited partner is limited to the extent of his capital contribution. Limited partnerships are not allowed by the Indian partnership act. Limited liability partnership In India limited liability partnership act was passed in the year 2008 and it came into force with effect from January 9, 2009. Limited liability partnership is a hybrid corporate form of organization. It enables professional enterprise and entrepreneurial initiative to combine, organize and operate in an innovative and efficient manner. It has the flexibility of the partnership firm and the advantages of the company at a low compliance cost. Formation of Partnership A partnership firm can be formed through an agreement among two or more persons. The agreement may be oral or in writing. But it is desirable that all the terms and conditions of partnership are put in writing so as to avoid misunderstanding and disputes among partners. Such a written agreement of partnership is known as partnership deed. The partnership deed must be stamped properly and each partner should be given a copy of the deed. The partnership deed is not a public document. It can be altered with the mutual consent of all the partners. It lays down the mutual rights and obligations of the partnership deed usually contain the following points: i) Name of the firm ii) Name and addresses of all the partners, iii) Nature of the firm’s business, iv) Date of the agreement, v) Principal place of the firm’s business, vi) Duration of partnership, if any, vii) Amount of capital contributed by each partner, viii) Profit and loss sharing ratio, ix) Loans and advances by partners and interest payable on that, x) Withdrawal allowed to partners and rate of interest on that, xi) Amount of salary or commission payable to any partners, xii) The duties, powers and obligations of partners, xiii) Maintenance of accounts and audit, xiv) Mode of valuation of goodwill on admission, retirement or death of a partner. xv) Procedure for dissolution and settlement of accounts, xvi) Arbitration for settlement of disputes, xvii) Arrangement in case a partner becomes insolvent, xviii) Any other clause which may be found necessary Types of Partners 1. Active or Working Partner – a partner who contributes capital and takes active part in the management of the partnership firm is known as active or working partner. He has unlimited liability and is partner in the real sense. 2. Special or limited partner – he is a partner whose liability is limited to the extent of his capital contributed to the firm. He has no authority to take part in the management of business. 3. Dormant or sleeping partner – such partner does not take active part in the management of the firm. He shares the profit and his liability is unlimited. 4. Nominal or ostensible partner – He is a partner in name only because he neither contributes capital nor takes part in the management of the firm. 5. Partner in profits only – a partner who shares in the profit of a firm but who is not liable for losses is called’ partner in profits’ only. 6. Sub-partner – when a person makes an arrangement with a partner to share his profit, he is known as a sub- partner. 7. Minor as a partner – a minor is a person, who has not completed 18 years of age. Legally, a minor cannot become a partner but he may be admitted to the benefits of partnership. RIGHTS AND OBLIGATIONS OF PARTNERS Rights of Partners 1) Right to take part in the conduct and management of the firm’s business. 2) Right to express his opinion on any matter related to firm. 3) Right to inspect and copy any books of accounts and records of the firm 4) Right to an equal share of profit unless otherwise agreed. 5) Right to receive interest on loans and advances made by him. 6) Right to indemnified for the expenses incurred and losses sustained by him Duties of Partners 1) Must act diligently and honestly in the discharge of his duties. 2) Must act in a just and faithful manner towards each other. 3) Must act within the scope of his authority entrusted to him. 4) Every partner is bound to share the losses of the firm equally unless otherwise agreed. 5) Every partner must identify the firm against losses sustained due to his willful negligence. 6) Must maintain and render true and correct accounts. Dissolution A distinction should be made between the ‘dissolution of partnership’ and ‘dissolution of firm’. Dissolution of partnership – implies the termination of the original partnership agreement of change in the contractual relationship among partners. A relationship is dissolved by the admission, insolvency, retirement, incapacity, death, etc. of a partner or on the expiry/completion of the term/venture of partnership. Partnership can be dissolved without dissolving the firm. Dissolution of firm- it implies dissolution among all the partners. The business of the partnership firm comes to an end. It’s assets are realized and the creditors are paid off. Thus dissolution of firm always involves dissolution of partnership but the dissolution of partnership does not necessarily mean dissolution of the firm. A partnership firm may be dissolved in following ways : 1) Dissolution by agreement:- A partnership firm may be dissolved with the mutual consent of all the partners in accordance with the terms of the agreement. 2) Dissolution by notice:- In the case of partnership-at-will, a firm maybe dissolved if any partner gives a notice in writing to other partners indicating his attention to dissolve the firm. 3) Contingent dissolution:- It involves dissolution of expiry of term, on completion of venture, on death of partner or insolvency of partner. 4) Compulsory dissolution :- A firm automatically dissolves if all partners or all but one is declared insolvent or when business of firm becomes unlawful. 5) Dissolution through court:- Court may order dissolution is a partner becomes of unsound mind, if a partner becomes permanently incapable of performing duties, guilty of misconduct or it is just or equitable to do so. Disadvantages of Partnership The partnership form of organization suffer from the following major disadvantages: a) Possibility of conflict:- The partners may disagree on various aspects of business, leading to disharmony and conflict. b) Risk of Implied Authority:- since the act of any partner is legally binding on the other partners and the firm, every partner will have to pay the consequence for any partner’s indiscretion or inefficiency. c) Unlimited Liability:- the liability of the partners being unlimited, i.e. extending even into their private estates, breeds an element of conservatism into the firm’s strategies and operations. d) Instability:- a partnership is an appropriate form of ownership for medium sized business involving limited capital, application of personal skill and judgment, diversified managerial talents and moderate risk. JOINT HINDU FAMILY BUSINESS The joint Hindu family form of business is one in which the undivided family possesses some property and the ‘karta’, the head of the family, operates it. The joint family business arises out of the provisions of the Hindu laws, and so is not governed by the Indian Partnership Act, 1932. The two forms of joint Hindu family business prevalent are follows: a) The Mitakshara: in this mode, only the successive generation in the male line can simultaneously inherit the ancestral property. This form is prevented in the whole of the country, except West Bengal. b) The Dayabhaga: in this form, females can also share the family property. This system commonly prevails in West Bengal. Advantages of Joint Hindu Family Business. The following may be cited as the prime advantages of this system: a) Continuity: It need not be dissolved on the insolvency or death of any member. b) Centralized Management: the management being centralized in the hands of the ‘karta’ leads to discipline and efficiency in the firm’s operations. c) Unlimited Membership: this form is not limited in membership by law. Hence, a large family would automatically mean moiré coparceners. d) Limited Liability: the liability of all the coparceners being limited, with the exception of the ‘karta’, is a prime advantage of this form. Disadvantages of Joint Hindu Family Business The chief disadvantages marking this form of business may be listed as the following: a) Lack of Congruence between Effort and Reward: Through the ‘karta’ look after the business, the rewards are shared by all the coparceners. b) Limited Financial Resources: This form has relatively limited financial resources, nor can it raise funds as a joint- stock company can. c) Limited Managerial Ability: Science the management is vested with the family head under law, it does not ensure any criterion for the decision making powers to be centred in him other than age. This may handicap the business owing to the ‘karta’s lack of relevant knowledge, qualification, vision or innovativeness. d) Relative Instability: This form of business is dependent on the continuance of the joint family system itself, which is gradually disintegrating in the face of rapid modernization and the consequent social mobility. cooperative societies The cooperative movement has been the outcome of the economic and social imbalances caused by the Industrial Revolution. Cooperative societies have acquired significance in both capitalist countries as the US and Japan, as well as in socialist countries. To get complete syllabus see following attechemnt; |