Praxis Business Education cheat sheet

Management functions cycle: planning sets goals, organizing allocates resources and authority, leading motivates and directs, controlling measures performance against standards and corrects deviations.

Span of control: a narrow span yields a tall hierarchy with more managerial layers; a wide span yields a flat structure with fewer layers and more delegated authority.

Break-even units = fixed costs / (price - variable cost per unit); break-even sales dollars = fixed costs / contribution margin ratio, where CM ratio = (price - variable cost) / price.

Current ratio = current assets / current liabilities; quick ratio = (cash + marketable securities + receivables) / current liabilities, excluding inventory and prepaids.

Debt-to-equity = total liabilities / total equity; a rising ratio signals heavier reliance on creditors and greater financial leverage risk.

Working capital = current assets - current liabilities; a positive figure indicates short-term obligations are covered by short-term resources.

Time value of money: future value = present value x (1 + r)^n; present value = future value / (1 + r)^n, where r is the periodic rate and n the number of periods.

Leadership contrast: autocratic leaders centralize decisions; democratic leaders share decisions; laissez-faire leaders delegate decisions and provide minimal direction.

Four Ps of the marketing mix are product, price, place, and promotion; the finance function interacts with them through pricing, credit terms, and budget approval.

Accounting equation: Assets = Liabilities + Owner's Equity; every transaction keeps the equation in balance through at least two equal debit and credit entries.

Debit and credit rules: debits increase assets, expenses, and dividends; credits increase liabilities, equity, and revenue; normal balances follow the increase side.

Accrual basis records revenue when earned and expenses when incurred; cash basis records them when cash changes hands, so the two produce different net income.

Adjusting entries at period end handle accruals (earned but unbilled revenue, incurred but unpaid expense) and deferrals (prepaid expenses, unearned revenue).

Depreciation methods: straight-line = (cost - salvage) / useful life; double-declining balance applies twice the straight-line rate to beginning book value, ignoring salvage until the final year.

Closing entries zero out temporary accounts (revenues, expenses, dividends) and transfer the net result to retained earnings; permanent accounts carry forward.

Contract formation requires offer, acceptance, consideration, capacity, and legality; a contract lacking any element is generally unenforceable.

Uniform Commercial Code Article 2 governs sales of goods and relaxes common-law rules: firm offers by merchants need no consideration, and the mirror image rule yields to the perfect tender rule.

Business torts and agency: respondeat superior holds a principal liable for an employee's torts committed within the scope of employment; independent contractors generally fall outside it.

Market segmentation divides buyers by demographic, geographic, psychographic, and behavioral variables; targeting selects segments; positioning creates a distinct place in the buyer's mind.

Product life cycle stages are introduction, growth, maturity, and decline; pricing typically starts high (skimming) or low (penetration) at introduction and turns competitive in maturity.

Break-even for a new venture = fixed costs / unit contribution margin; contribution margin = unit price - unit variable cost.

SWOT analysis pairs internal strengths and weaknesses with external opportunities and threats; the TOWS matrix converts them into SO, ST, WO, and WT strategies.

Pricing strategies: cost-plus adds a markup to cost; value-based prices on perceived benefit; penetration sets a low initial price to build share; skimming sets a high initial price to capture early adopters.

Marketing funnel stages run awareness, interest, consideration, purchase, and loyalty; conversion rate = conversions / visitors, and customer acquisition cost = total acquisition spend / new customers.

Elevator pitch structure: problem, solution, target market, business model, traction, and ask; venture capital investors typically look for a scalable market and a defensible advantage.

Promotion mix components are advertising, personal selling, sales promotion, public relations, and direct/digital marketing; push strategy targets channel members, pull strategy targets end consumers.

Spreadsheet cell references: relative references (A1) shift when copied; absolute references ($A$1) stay fixed; mixed references lock only the row ($A1) or column (A$1).

Common spreadsheet functions: SUM totals a range, AVERAGE computes the mean, IF returns one value when a logical test is true and another when false, VLOOKUP searches the first column of a range and returns a value from a specified column.

Database normalization reduces redundancy: first normal form removes repeating groups, second normal form removes partial dependencies on part of a composite key, third normal form removes transitive dependencies.

Network basics: a LAN spans a limited area such as one building; a WAN spans broad distances; a firewall filters traffic by rules; a VPN encrypts traffic over a public network.

Data integrity controls include input validation, backup schedules, access permissions by role, and audit trails that log who changed what and when.

Business writing structure: state the purpose in the opening, support it with organized detail in the body, and close with a clear request or next step; use active voice and parallel structure.

Memo format carries a header of To, From, Date, and Subject and omits a salutation; a business letter includes a salutation, body, and complimentary close.

Email etiquette rules: one topic per message, a specific subject line, reply-all only when all recipients need the information, and attachments named descriptively.

Presentation delivery: limit each slide to one main idea, keep text to a few lines, and use visuals to replace paragraphs rather than decorate them.