Take a couple minutes and put these following eight statements in two different groups. Each group will have 4 statemen

1. Take a couple minutes and put these following eight statements in two different groups. Each group will have 4 statements in each group T-Shirts in a clothing store Cash in the cash register Rent due on a lease Owning a forklift Loan payment on company van Unpaid electric bill Cash in the safe Money to be paid in a lost lawsuit After you have split them into 2 categories, formulate and write down your reasoning for putting the statements in the appropriate categories. Basically, why did you put them where you did?

2. Answers Assets T-Shirts in a clothing store Cash in the cash register Owing a forklift Cash in the safe Liabilities • Rent due on a lease • Loan payment on company van • Unpaid electric bill • Money to be paid in a lost lawsuit

3. What does that mean??? Please take 1 minute and write down your definition of an assets and a liability. Asset- Property and other items of value owned by a business. Liability- Creditors’ claims to the assets of a business. Money that a business owes.

4. Categorize the following as either an asset or liability Put your thumbs up if it is an asset Put your thumbs down if it is a liability • Owned Ice cream machine • Employee uniforms • Salaries • Purchased materials for construction • Insurance premium due • Tables for a restaurant bought on credit

5. With a partner I want you to think of common assets and liabilities for a pizza place. Write down as many as you can think of. I will give you 3-4 minutes.

6. Take a couple minutes and put these following eight statements in two different groups. Each group will have 4 statements in each group This concept is completely different from the last one we learned. Do not think assets and liabilities, this is different We are pretending that you are opening a record store • Rent • Sign for outside the business • Display cases • Stereo system for inside • Records and CDs/Inventory • Employees salaries • Fee for business permit • Electric Bill After you have split them into 2 categories, formulate and write down your reasoning for putting the statements in the appropriate categories. Basically, why did you put them where you did?

7. Here’s how I grouped them: Start-up Expenses Operating Expenses • Sign for outside the business • Display cases • Stereo System • Fee for business permit • Rent • Records and CD’s Inventory • Employee salaries • Electricity Bill Please create a definition of start-up expenses and operating expenses

8. Definitions Start-up Expenses- Costs you incur before you start up your business. To figure start-up costs, you need to talk to vendors, suppliers, manufacturers, distributors, and others in your industry Example: Security deposit, licenses, furniture, promotion Operating Expenses-Amount of cash needed to carry out the daily business operations

9. I want you to think of start-up and operating expenses for a pizza place. Think in terms of supplies, personnel, things to get running, food, etc Write down as many as you can think of. I will give you 3-4 minutes.

10. Different Account Concept Once again, this concept is completely different from the last one we learned. Do not think start-up and operating expenses, or assets/liabilities We are going to pretend you are opening up a coffee shop that sells its homebrewed coffee in a brick and mortar store and over the internet. Place these expenses into two categories Rent Coffee beans Heating bill Payment on a loan Cost for web hosting Office supplies Phone/Internet bill Shipping Expenses

11. Here’s how I grouped them: Fixed Expenses Variable Expenses • Rent • Payment on a Loan • Cost of web hosting • Phone/Internet Bill • Coffee beans • Heating bill • Office supplies • Shipping Expenses Please create a definition of fixed and variable expenses

12. Definitions Fixed Expenses- Expenses that do not change each month or with the number of units produced. Ex: insurance or rent Variable Expenses- Expenses that change from month to month or with each unit of product produced such as supplies, wages, and production materials

13. I want you to think of common fixed and operating expenses for a pizza place. Write down as many as you can think of. I will give you 3-4 minutes.

14. In a Word document I want you to come up with about 15 start-up and 15 operating expenses for the business you are going to start. I also want 15 fixed and 15 variable expenses.