Question

3- a) List and describe IN YOUR OWN WORDS the five functions of a manager?

    b) How are financial statements used by business?

    c) Compare variable and fixed expenses. USE YOUR OWN WORDS.

Answer 1

(a)1. to make plan for the organization having long term vision

2. to manage the people that means the human resource management means recruitment, training, removal of people etc.

3. To make strategy to implement the plan of the organization.

4 to have control Means to ensure that the plans are being implemented properly or not and if there are any deviations make it correct.

5. To acquire, use and distribution of the funds required for the organizational purposes.

(b)

For the organization itself the income statement shows the overall result of the organization and the balance sheet show the position of the assets and liability at the end of the year. While for the other organisation can use it to know the performance of the business the share holders of the company use it to evaluate the company the banks and other financial institution use it to take decision about providing funds to the business or not. the it is one of the tool to measure performance of an organization.

(C)

variable expences are those which changes with the Quantum of an activity for example in the production unit the variable costs are those which Increase if production rises and it Decrease as Production decrease it remains same per unit or average for each unit. At other side the fixed cost are those which has fixed monetary value regardless of the Quantum of Production or activity for example the Rent paid on Factory Building will remain same whether we run production or not. Hence the fixed cost are remain same in total and decrease as the number if units rises and from this characteristic of the fixed cost another concept called economies of scale has come. According to this concept the organization should produce at huge volume so the per unit fixed cost if the product decline.

I hope my efforts will be fruitful to you....?