Q2 Lesson 1: Nature and Type of Entrepreneurial Venture PDF

Q2 Lesson 1 Nature and Type of Entrepreneurial Venture ❖Describe the forms of entrepreneurial venture, ❖Classify the business according to nature ❖Discuss the elements of production system. Forms of Entrepreneurial Venture 1.Sole proprietorship 2.Partnership 3.Corporation 4.Coo...

Q2 Lesson 1 Nature and Type of Entrepreneurial Venture ❖Describe the forms of entrepreneurial venture, ❖Classify the business according to nature ❖Discuss the elements of production system. Forms of Entrepreneurial Venture 1.Sole proprietorship 2.Partnership 3.Corporation 4.Cooperative 1.Sole Proprietorship is a form of business organization that is owned by a single individual who is singly responsible for running the business and is accountable for all debts and obligations related to the business. 1.Sole Proprietorship The characteristics of sole proprietorship are as follows: 1. It is easy to form and manage. 2. It is simple business operation. 3. It has limited pool of resources. 4. Its growth is limited. 5. The owner has unlimited liability. 2.Partnership Is a form of business organization in which two or more persons combine their resources in a business with a view to making profit. 2.Partnership The life of the partnership is easily dissolved compared to a corporation, particularly for the following reasons: 1. Death of one of the partners. 2. Admission of a new partner in an existing partnership. 3. Personal insolvency of one of the partners. 4. Permanent withdrawal of the investment of a partner. 3.Corporation Is a legal entity that is separate from its owners, the shareholders. No shareholder is personally liable for the debts, obligations or acts of the corporation. It is formed by at least five but not more than fifteen persons. The persons originally forming the corporations are called incorporators. 3.Corporation A corporation can either be: ▪Stock or non-stock ▪Profit or non-profit ▪Domestic or foreign 3.Corporation Stock corporation – when it is authorized to issue shares of stock to stockholders Non-stock corporation – is not authorized to issue shares of stock to the members. The owner of a stock corporation are called stockholders or shareholders, while the owners of a non-stock corporation are called members. 3.Corporation Certificate of stock – is an evidence of ownership of a corporation. Domestic corporation – is organized under the laws of the Philippines. Foreign corporation – is organized under the laws of the foreign country but has the authority to operate in the Philippines. 4.Cooperative Is an entity organized by people with similar needs to provide themselves with goods or services or to jointly use available resources to improve their income. Nature of Entrepreneurial Venture The term Nature simply refers to whether the business is simply selling a product, manufacturing a product, or rendering a service to customers. Nature of Entrepreneurial Venture The classifications of entrepreneurial venture according to its nature are as follows: 1. Merchandising 2. Service 3. Manufacturing 4. Agriculture 5. Hybrid business 6. Special corporation Merchandising Is engaged in the buying and selling of the products or goods. It does not alter the appearance of the product purchased from the seller. Merchandising Service provides services to customers Service entrepreneurial ventures are classified as non- professional service and professional service. Service (non-professional service venture) Service (professional service venture) Manufacturing is a producer of goods or products. It is engaged in buying raw materials and supplies to be processed into finished products. Manufacturing Agriculture Is engaged in the production of agricultural goods and animals. It may sell its products as raw material or as finished goods. Agriculture Hybrid Business Possesses the characteristics and nature of combined types of business entities. It is inherent in the business to produce and sell goods and the at same time provide services to customers. Hybrid Business Special Corporation Special types of business may include cooperatives, joint ventures and non- profit organizations. The concept of innovation or creativity must be introduced and practiced by entrepreneurs…. Production System Input The input includes the following: 1.Manpower 2.Materials 3.Machines 4.Design 5.Instructions Production Process Referred to as the transformation or conversion process. Is the stage of production where the materials are transformed into the final product with the aid of manpower and machine. Production Process It involves the following activities: 1. Procurement or acquisition of raw materials and manufacturing supplies. 2. Inspection of materials and supplies upon receipt at the receiving section. 3. Storage of acquired materials and supplies. 4. Issuance of materials and supplies to the production line. 5. Inspection of damaged or broken goods and assessment of losses. 6. Rework or repair of defective goods. 7. Transfer of finished goods to the storeroom. Output Represents the final products from the production process and distributed to the customers.