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Entrepreneurship How to Start & Operate a Small Business Financing Strategy Debt or Equity Chapter 14. “ Compare debt and equity financing.” “Discuss the three basic legal business structures: sole proprietorship, partnership, and corporation.”
“Discuss the three basic legal business structures: sole proprietorship, partnership, and corporation.”
“Choose alternative forms of financing such as micro-loans and “bootstrapping.”
Calculate debt ratios and debt-to-equity ratios
“Nothing will work unless you do”. Maya AngelouKey Objectives
Net Profit per Month
Definition of Bonds and Stock Sale
This determines a company’s financial status. Does the company owe more money than its worth?
amount of assets
(for additional information about angel financing, visit: http://acenet.csusb.edu/)
Sole Proprietorship Greeting Card Making Business
Objective: Student/s should be resourceful when purchasing their stock for opening their greeting cards making
business i.e. cards don’t have to be in color, they can make their own cards from stock paper and not buy already
made blank cards, etc. They have to purchase material to make 12 greeting cards (saving enough money back for a
cash reserve account).
Material: 1 box of 4x4 blank cards
1 pack of white cards stock paper
20 boxes of crayon or less depending on class size
1 box of 4x4 envelopes
1 pack of heavy duty of white copy
20 packs of I dollar bills play money
Each item will be priced differently i.e.:
1blank business cash @ $1.50 each
1 sheet card stock paper @ $ 0.75 each
1 sheet heavy duty white copy paper $ 0.50 each
1 box of crayon @ $1.00 each
1 box of pencils @ $.15 each
Envelope @ $ 0.25 each
20 Glue Sticks @ $ 0.10 each
20 pair of scissors @ 0.75 each
Instruction: Each student will borrower $20.00 from the bank (class instructor is the banker) at an interest rate of
7.5%. In order for the banker to approve the loan the student has to calculate total amount he/she has to pay back to
the bank i.e. 20.00x 7.5% = total pay back of $21.50. After the student secures his/her note they may begin to
purchase material needed to start their greeting cards making business.
All student’s have to keep a reserve funds from the $ 20.00 that they borrower from the bank, (teacher can’t tell
students to maintain any of their money for a cash reserve account) this is something that students should learn
from reading chapter 14 about the important of maintaining reserve funds for their business.
Entrepreneurship: How to Start &
Operate a Small Business
By Steve Mariotti with Tony Towle, 10th edition
“No individual has any right to come into the world and go out of it without leaving something behind”.
George Washington Carver