OAE Business Education cheat sheet

Accounting equation: Assets = Liabilities + Owner's Equity; every transaction preserves this balance, so each entry debits one account and credits another for equal amounts.

Debit/credit rules by account type: assets and expenses increase with debits; liabilities, equity, and revenue increase with credits. Contra accounts move opposite their parent.

Income statement flow: Revenue − Cost of Goods Sold = Gross Profit; Gross Profit − Operating Expenses = Operating Income; then add/subtract non-operating items to reach net income.

Cost of goods sold under periodic inventory: Beginning Inventory + Purchases − Ending Inventory = COGS. Under perpetual systems, COGS updates at each sale.

Break-even in units = Fixed Costs ÷ (Price − Variable Cost per Unit); break-even in dollars = Fixed Costs ÷ Contribution Margin Ratio.

Gross profit margin = Gross Profit ÷ Net Sales; current ratio = Current Assets ÷ Current Liabilities; debt-to-equity = Total Liabilities ÷ Total Equity; inventory turnover = COGS ÷ Average Inventory.

Time value of money: Future Value = Present Value × (1 + r)^n; Present Value = Future Value ÷ (1 + r)^n. Compounding frequency raises effective annual rate above nominal rate.

Depreciation methods: straight-line = (Cost − Salvage) ÷ Useful Life; double-declining balance = 2 × straight-line rate × beginning book value, ignoring salvage until the final year.

Trial balance proves debits equal credits but does not detect omitted transactions, offsetting errors, or entries posted to the wrong account of the same normal balance.

Supply curve slopes upward (higher price elicits greater quantity supplied); demand curve slopes downward. Equilibrium occurs where quantity demanded equals quantity supplied.

Price elasticity of demand = % Change in Quantity Demanded ÷ % Change in Price. Demand is elastic when the absolute value exceeds 1, inelastic when below 1.

Market structures: perfect competition (many sellers, identical products, price takers); monopolistic competition (differentiated products); oligopoly (few sellers, interdependence); monopoly (single seller, barriers to entry).

GDP expenditure approach: GDP = Consumption + Investment + Government Spending + (Exports − Imports). GDP counts final goods only, within a country's borders, in a defined period.

Business cycle phases: expansion, peak, contraction (recession), trough. Unemployment types are frictional, structural, cyclical, and seasonal; only cyclical tracks the business cycle.

Federal Reserve tools: open market operations (most frequently used), discount rate, and reserve requirements. Buying securities expands the money supply and lowers short-term rates.

Inflation erodes purchasing power; nominal interest rate ≈ real interest rate + expected inflation (Fisher effect). Deflation raises the real burden of fixed-rate debt.

Comparative advantage: a party should specialize where its opportunity cost is lowest, even without an absolute advantage, and trade raises total output.

Law of diminishing marginal utility: as consumption of a good increases, the additional satisfaction from each extra unit declines, which helps explain the downward-sloping demand curve.

Management functions: planning (setting goals), organizing (allocating resources), leading (motivating and directing), controlling (measuring performance against standards and correcting deviations).

Maslow's hierarchy ascends physiological, safety, social, esteem, and self-actualization needs; a lower need generally must be met before the next motivates behavior.

Herzberg's two-factor theory separates hygiene factors (pay, policy, working conditions) that prevent dissatisfaction from motivators (achievement, recognition) that produce satisfaction.

Leadership styles: autocratic (leader decides), democratic (shared input), laissez-faire (group decides). Situational leadership matches style to follower maturity and task structure.

Span of control is the number of subordinates reporting to one manager; a narrow span yields a tall hierarchy with more management layers, a wide span a flat structure.

Marketing mix (4 Ps): Product, Price, Place (distribution), Promotion. Pricing strategies include penetration (low introductory price), skimming (high initial price), and cost-plus.

Product life cycle stages: introduction, growth, maturity, decline; promotion and pricing emphasis shift at each stage, with maturity typically the most competitive.

Human resource process: job analysis produces job descriptions and specifications, which support recruitment, selection, orientation, training, performance appraisal, and compensation.

Business ownership forms: sole proprietorship (unlimited liability), general partnership (joint and several liability), limited partnership (limited partners liable only to investment), LLC (limited liability, pass-through taxation), and corporation (limited liability, double taxation of C-corp profits).

Contract elements required for enforceability: offer, acceptance, consideration, capacity, and legality; a counteroffer terminates the original offer.

Torts divide into intentional, negligent, and strict liability. Negligence requires duty, breach, causation, and damages; comparative negligence reduces recovery by plaintiff fault.

Uniform Commercial Code Article 2 governs sale of goods; common law governs service contracts. UCC implied warranties include merchantability and fitness for a particular purpose.

Intellectual property: patents protect inventions for 20 years from filing; copyrights protect original expression for the author's life plus 70 years; trademarks protect source identifiers indefinitely with use.

Agency law: the principal is bound by an agent's acts within actual or apparent authority; ratification can bind a principal to an unauthorized act after the fact.

Employment law: Title VII of the Civil Rights Act prohibits discrimination based on race, color, religion, sex, and national origin; the EEOC enforces it. FLSA sets minimum wage and overtime.

Bankruptcy chapters: Chapter 7 liquidates assets; Chapter 11 reorganizes a business; Chapter 13 reorganizes an individual's debts under a repayment plan.

Computer literacy versus integration: literacy is skill with hardware and software; integration embeds technology into instruction to meet content objectives, not as an add-on.

Career and technical student organizations (e.g., FBLA, DECA) provide competitive events and leadership development aligned with business program standards.

Assessment alignment: formative assessment informs instruction during learning; summative assessment certifies achievement after instruction. Both must map to stated objectives.

Instructional design sequence: set measurable objectives, select methods and materials, deliver, assess, and revise based on results (the ADDIE model: Analysis, Design, Development, Implementation, Evaluation).

Cooperative learning structures require positive interdependence, individual accountability, promotive interaction, and group processing; grading only the group product violates individual accountability.

Differentiation adjusts content, process, or product based on readiness, interest, and learning profile; it is not tracking by ability.

Work-based learning forms include internships, cooperative education, school-based enterprises, and job shadowing; each requires a training agreement and supervised learning objectives.

Academic standards crosswalk: business courses commonly reinforce mathematics (spreadsheet formulas, interest calculations), English language arts (business writing), and social studies (economics).

Authentic assessment in business education uses portfolios, simulations, and projects scored with rubrics that state performance criteria at defined proficiency levels.

Spreadsheet formulas begin with = ; relative references (A1) shift when copied, absolute references ($A$1) do not, and mixed references lock one coordinate.

Spreadsheet functions: SUM, AVERAGE, COUNT (counts numeric cells), COUNTA (counts non-empty cells), IF(condition, value_if_true, value_if_false), and VLOOKUP for table lookups.

Word processing: styles apply consistent formatting and enable automatic tables of contents; mail merge combines a main document with a data source of records.

Database hierarchy: field (column), record (row), table; a primary key uniquely identifies each record, and a foreign key links tables to enforce referential integrity.

Presentation design: limit text per slide, use high-contrast color, maintain consistent templates, and provide alternative text for images to meet accessibility needs.

Networking basics: LAN covers a limited area; WAN spans broad distances. IP addresses identify devices; DNS translates domain names to IP addresses.

Security practice: phishing exploits user trust, so verification of sender and links matters; strong authentication combines long passphrases with multi-factor verification.

Digital citizenship topics include netiquette, copyright and fair use in education, acceptable use policies, and protection of personally identifiable student information.