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  • A business does three things. It raises money.

  • and then it uses that money to acquires assets to use.

  • And it uses them to make a profit.

  • Depending on what a business does, it will use assets in a different way.

  • A business that performs a service will use assets to do things for other people.

  • A business that manufactures things will use assets to make other things to sell.

  • When a business uses it's assets to make a profit, it is called its OPERATING ACTIVITIES.

  • Before a business can engage in any OPERATING ACTIVITY, it must first acquire the assets

  • to use in it. The process of buying assets to use in a business is called the INVESTING

  • ACTIVITIES of a business.

  • Before a business can ever INVEST in any assets to use in a business, the business must have

  • money to spend. What happens if a business doesn't have money? Where can it get money?

  • The process of raising money through investors or lenders is called a business's FINANCING


  • As a review, A business engages in three activities.

  • These activities are Financing Activities, Investing Activities, and Operating Activities.

  • Financing is raising capital, to then invest in assets, to then use in it's operations,

  • to make a profit.

  • A business must be skilled at each of these activities if it wants to be successful and

  • make lots of money.

A business does three things. It raises money.

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