Page 426 - Business Principles and Management

Chapter 15 • Business Financial Records

accounting, finance, and management from colleges or universities often serve as
consultants. Large and small consulting firms sell their services to other businesses.
Some specialize in a particular area such as financial services; others offer expertise
in a broad set of business issues.

GOVERNMENT
Many state and federal government agencies provide financial information and
other resources for businesses. Probably the best known is the Small Business
Administration (SBA). The SBA is an agency of the federal government that pro-
vides information, advice, and assistance in obtaining credit and other financial sup-
port for small businesses. Regional offices in every state offer expertise and access
to a range of technical and managerial information for small-business owners and
people considering starting a new business. Other federal agencies offering re-
sources and assistance as well as regulations related to the financial performance
of businesses are the Department of Commerce and the Department of the Treasury.

CHECKPOINT

Identify four types of experts who can provide advice and help
on businesses’ financial problems.

15.4 Assessment

UNDERSTAND MANAGEMENT CONCEPTS
Determine the best answer for each of the following questions.
1. The amount of working capital available to a business is deter-
mined by
a. subtracting total liabilities from total assets
b. adding current assets and current liabilities
c. adding total assets and total liabilities
d. subtracting current liabilities from current assets
2. An example of an important financial ratio is
a. current ratio
b. past ratio
c. future ratio
d. all of the above

THINK CRITICALLY
Answer the following questions as completely as possible.
3. What benefits might managers obtain from comparing the financial
performance ratios of their company with the same ratios from com-
petitors’ companies? How might the comparisons be misleading?
4. Some businesspeople suggest that consultants should not be used
in a business because they aren’t familiar with the specific opera-
tions of the company. Do you agree or disagree?
Justify your opinion.

thomsonedu.com/school/bpmxtra

413