Business & Accounting Studies
English Medium
2025 O/L
RUWAN ATTANAYAKE
[Link] (MKT) Spe. (Hons)
National Languages Training Certificate (English)
General English Language Training Programme
Commerce Teacher of a Government Affiliated School in Colombo
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Grade 10 (English Medium)
Business and Accounting Studies
Ruwan Attanayake
[Link] (MKT) Spe. (Hons)
General English Language Training Programme
Commerce Teacher of a Government Affiliated School in Colombo
1. Background of Business
The following facts are discussed in this chapter.
1.1 Basic concepts about businesses
Business concept
Business objectives
Consumer needs and wants
Manufacturing businesses
Factors of production
1.2 Stakeholders of businesses
Stakeholders
Objectives of stakeholders
1.1 Basic concepts about businesses
Human develop, as a result needs also widened gradually and the wants were
diversified. It was difficult to produce all their needs and wants by themselves as
remedy to this problem.
People started to produce a large quantity of goods that they could produce
the best with skills and resources they had. (called Specification)
By doing the same activity over and over again the people gained a special
talent and competency of doing it. (called Specialization)
Therefore, an excess of goods was created. (called Surplus production)
People exchanged their excess goods with others to obtain other goods they
wanted (called Barter System)
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Barter – Exchange goods and Services with goods and Services
Drawbacks of Barter System
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Even today, no one produce all what he or she wants. Individual is either a producer or
consumer in different instances. Such producers and consumers fulfill their needs and
wants through Business.
Business Concept
Business
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The Reasons to Grow the Business Rapidly
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Business Objectives
Main Objectives
1. Earning profits - Profit earning objective is essential for a business because it has
to pay a sufficient return to the owners for their investment.
2. Increasing customer satisfaction - The survival of a business depends on how it
satisfies the needs and wants of its customers.
Sub Objectives
a) Increasing the quality of goods and services - Businesses intend to provide
quality goods and services at a reasonable price as well as to fulfill consumer
needs and wants.
b) Generating employment opportunities - Generate different job opportunities
from labourers to top managers.
c) Employee welfare - Providing various welfare facilities in addition to wages to
satisfy the employ es (Ex: Food, accommodation facilities, transportation
facilities and medical facilities )
Stages of business evolution
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Needs & Wants
Needs – …………………………………………………………………………………………….
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Characteristics of needs
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Wants – …………………………………………………………………………………………
Examples:-
Needs Wants
Food ……………………………………………………………….
Cloths ………………………………………………………………
Characteristics of wants
Not essential - For existence, it is not essential to fulfill a want as that need could be
satisfied by another similar want instead.
Being diverse - Even though the needs are common to any individual, the way they
satisfy them differs depending on their socio - economic condition.
Can be created - Businessmen can create wants.
Being complex - Due to being unlimited and diverse, fulfillment of wants is also
complex.
Being unlimited - There are different wants that can be used to fulfill a single need.
Determining Factors of Human Wants
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Exercise 1 :-
Categorize below wants under needs of Food, Cloths, Shelter, Security, Education, Health,
Communication, Transport and Entertainment.
security, frock, surgical operations, huts, train, flowering, education courses, insurance,
bread, TV , rice, medicine, saree, earrings, doctors, trouser, shack houses, push bicycle,
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shoes, motor bike, tents, water, picnic, caves, sports, films, parental care, radio, internet,
Pittu, milk, buns, teachers, postal service, newspapers, string hoppers, wooden houses, self-
employment, , necklace, books, bus, carts, nursing service, tea, apartment
Exercise 2 :-
Write down different ways you follow to satisfy the following needs.
Need Wants
Food
Clothing
Housing
Education
Health
Safety
Transportation
Communication
Entertainment
Goods and Services
Goods – …………………………………………………………………………………………….
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Services – …………………………………………………………………………………………..
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Difference between Goods and Services
Goods Services
Tangible
Can be stored
Can be separated from the supplier
Production and consumption do not occur at
the same time
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Manufacturing Businesses
Depending on the nature of the product produce business can be categorized in to two;
1. 1. Commodity Manufacturing Businesses (Goods)
The establishments which produce the commodity (goods) required for the fulfillment
of human needs and wants are called as Commodity Manufacturing Businesses.
Examples :- Processed food, automobiles, electric ovens, mobile phones, washing
machines, furniture
2. Service Providing Businesses (Services)
The businesses providing the services are known as Service Providing
Businesses.
Examples :- Wholesale businesses, Retail businesses, Insurance Institutions,
Banking Institutions, Beauty salons, Educational Institutions, Transport service,
Factors of Production
Businesses require different resources to produce goods and services. These resources
required are known as factors of production. The factors of production can be categorized
basically as land, labour, capital and entrepreneurship.
1. Land
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Examples :- ………………………………………………………………………………..
2. Labour
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Examples :-
Labour Individuals rendering physical efforts - Workers in the mines
Sanitary labourers
Individuals rendering mental efforts – Accountants
Managers
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3. Capital
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Examples :- …………………………………………………………………………………
4. Entrepreneurship
Entrepreneurship encompasses the role of organizing factors of production such as
land, labour and capital required for production in order to start and conduct a
manufacturing process. An entrepreneur takes the risk, creates innovations and
takes decisions with regard to the business.
1.2 Stakeholders of businesses
Stakeholders are …………………………………………………………………………..
Owners - Owners are the persons providing resources to the business. The owner of a
business can be either a single person or a group of persons.
Managers - The business operations are conducted and decisions of the owners are
implemented by managers. In large scale businesses, there can be number of managers
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such as finance manager, marketing manager, operation manager, human resources
manager etc.
Customers - Customers are the persons who buy goods and services from a business.
They can buy these goods either with the re-selling motive or with the motive to use
on own consumption.
Suppliers - Suppliers are the providers of raw materials, transport facilities, etc. to a
business.
Competitors - Competitors are other businesses producing or selling similar goods or
services to a business in operation.
Financial institutions - Financial institutions are the institutions providing required
loans, consultancy services etc. to a business.
Employees - Individuals performing the operations of a business are known as
employees.
Government - The government propagates policies required to achieve economic
growth of a country.
Community - Includes the population living outside of the business in the society
Examples :- Journalists, environmentalists, pressure groups
Future investors - Individuals and institution willing to invest
Objectives of Stakeholders
Stakeholders Objectives
Security of investment
Earning a sufficient profit
Growth of the business operations in future
Taking decisions required to achieve the objectives
Implementing those decisions
Promotions and job satisfaction
Receiving a fair wage or a salary
Job security
Obtaining products at a reasonable price
Obtaining quality products
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Securing orders continuously
Obtaining money without any delay
Collecting loans and advances given
Providing more loans and advances
Collecting taxes due
Generating employment opportunities
Increasing the domestic production
Determining the prices of own products
To face competition
Analyzing whether the business activities are
conducted in an environmentally friendly manner\
Analyzing whether business contributes to the social
welfare
Taking decisions on investment
Expected contributions by the Business from Stakeholders
Stakeholders Expected Contribution
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Owners ……………………………………………………………………………
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Managers
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Employees
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Suppliers
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Government ……………………………………………………………………………
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Stages of Business Evolution – Figures
1. Barter System
2. Use of Money
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3. Industrial Revolution & 4. Information Era
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