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In this article, we will know What is Business?
What is Business?
Business is a process.
Practice of making one's living or making money by producing or buying and selling products. It is also "any activity or enterprise entered into for profit." A business entity is not necessarily separate from the owner and the creditors can hold the owner liable for debts the business has acquired.
What is object of business?
- Earn profit.
Important!A good name is often one of the most valuable assets of a business, so it's important that business owners choose their name wisely.
What we do in business?
To answer this question first. We need to understand process of business.
Can you run your business alone.
| Business. | Employee |
| Costomer | |
| Bank | |
| Financial | |
| Supplier |
We do only financial transaction in our business?
Financial Transaction?
- Goods purchased worth Rs. 5 Lakhs.
- Goods sold worth Rs. 6 lakhs.
- Amount Deposited in Bank Rs. 6 lakhs.
- Amount paid to supplier through online bank transfer.
- Salary paid to employee.
- Amount received from customers.
- Again amount Deposited in Bank.
- Make payment of expenses through bank.
Example: 1
We purchased goods worth Rs. 100/-
And sold it in Rs.120/-
What we earn.........?
Answer: 20 Rs. Profit....
Example: 2
We purchased Goods worth Rs. 100/-
And sold it in Rs. 95/-
What we earn..........?
Answer: 5 Rs. Loss.....
= Profit- 15 Rs. = Loss- 5 Rs.
What we have Done?
- We record the both financial transaction and through that we calculate profit and loss.
- This process called accounting.
Conclusion
Starting a business involves many steps. Creating a business plan, increasing the store to start the business, where to locate the business and what kind of business it will be, choosing a good title, completing printed material to list the industry, obtaining assessment reports and obtaining permissions and licenses are all part of this preparation.
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