Please respond to one of the following topics. Post your intial response at leas

Question

Please respond to one of the following topics. Post your intial response at least by Wednesday and then interact with two of your classmates about what they have posted at least by Sunday.

TOPIC 1: You have read about the Sarbanes-Oxley Act.  Why do you suppose Congress passed this law?  In your opinion, is the law providing any benefit for the average investor?  Do you think if we have enough such laws, it will eventually be impossible to commit corporate fraud or similar activities?

TOPIC 2: What are the three distinct types of business activity in which companies engage? Assume that you start your own company to rent bicycles in the summer and skis in the winter. Give an example of at least one of each of the three types of business activities in which you would engage.

Explanation / Answer

Topic 2 : 3 distinct types of business activity in which companies engage

All the business activities that a business or an organization engage into can be classified into 3 major types. They are :

1.Operating Activity :

This mode of acitvity is involved into manufacturing and providing the necessary goods to services. They have various departments like sales departments, demand forecast and anlaysis, innovating more dinstinct products to satisfy the customer needs.

2.Finanicing acitvity :

Finanicing activity is a method of raising money from contributions made by other actual owners of the business. These business management admins obtain loans from outside and run the business.

3 .Investing Activity :

To start a new business:

To start a new business such as renting cycle sin the summers vacation and renting skies in the winter, requires a huge amount of money. This money is financed by the contributions by the owners or banks provides loans . This phase of getting money and being financed by a thir sourceis known as Financing Phase .The business so started with the money contributed, then its needs to invest on the goods that it will rent . Renting goods like cycles in summer and skies in winter.This phase of investing in the assests is known as Investing Phase.Then the business is set to start by marketing , creating awareness about such an acitvity.The operating expenses so involvedin the proces are advertising, wages to the employees, maintainence of the goods, government taxes. This phase is known as Operationg Phase.

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