Page 432 - Business Principles and Management

project:
MY BUSINESS , INC.

COMPLETING INITIAL FINANCIAL PL ANNING
As a new business owner, you must be able to assess the financial needs of
your business realistically. You will need this information to obtain financ-
ing and make operating decisions. Businesspeople need a complete set of
financial records to make management decisions. This is very important
for new businesses, as financial resources are usually limited. As you com-
plete this part of the project, you will review the financial records needed
for your business and the sources of record-keeping assistance available.
You will use the information to make initial financial decisions and
develop financial statements to serve as initial estimates of the financial
condition of your new business.

DATA COLLECTION

1. Interview an accountant or review small-business management mate-
rials. Use the interview or materials review to determine the types of
financial records you will need for your business. Develop a list of all
of the records you believe you will need to maintain as the business
owner.
2. Obtain a copy of a small-business financial planning software pack-
age for use on a desktop computer. Examine each of the forms and
records included with the package and determine the type of infor-
mation the business would need to acquire in order to complete each
of the forms and records.
3. Locate a source of sample financial information for small retail busi-
nesses (especially fast-food or specialty-food businesses). You should
be able to find average figures for balance sheets and income state-
ments as well as average financial ratios. The Internet and most
libraries are good places to begin your search.

ANALYSIS
1. Develop a detailed set of procedures to be followed in your business
for the safe handling of cash. Be certain to consider all situations in
which cash will be handled.
2. Prepare a sample cash budget for your business. The budget should
cover the first three months of business operations.
3. Prepare a beginning estimated balance sheet for your new business.
It should show the planned financial position of your business for
its first day of operation.
4. Prepare an estimated income statement for the first three months of
the operation of your business. Be realistic in your estimates. You may
not show a profit.

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