The Financial Crisis and Small Business in the Classroom – Part 3
This is the third of a 4-part series on small business and the financial crisis. (See post #1 and post #2). The major teaching points and exercises in this series are based on an interview with the Acting Director of the Small Business Administration, Sandy K. Baruah (see this video).
Today’s topic: Financial Statements 101 & an Introduction to Debt and Equity.
Among other key tips for small business, Sandy K. Baruah – SBA Acting Administrator – noted that in obtaining credit your business’s current financial situation is important. 70% of small businesses report having problems obtaining credit. Banks want to know: Will you be able to pay back your loan?
Level A. Engage students in an overview discussion about the importance of understanding a business’s finances using the following articles as a starting point:
Financial literacy is hot (see bottom of earlier post)
This article from Business Week runs through a laundry list of items for small business owners to look into regarding their banks, insurance carriers, and the like. However, the big takeaway is for business owners to be prepared to handle decreased confidence in the economy which can impact spending.
Level B. Complete a financial exercise in the EITC curriculum or other “financial statement 101”-type template. Discuss debt/equity and financial statement sections. Debt, Equity, and Financial Statements: Module 3, Slides 23 to 30 (Option: Exercise 3-4 PDF, Part 2) & Slides 44 to 52
Entry filed under: Business exercises, Educators, NFIB, Teachers, Teaching tools, Uncategorized, Young Entrepreneur, Young Entrepreneur Foundation. Tags: credit, Financial Crisis, financial exercises, Financial Literacy, financial statements, free tools for teachers, problems, Sandy Baruah, Small Business.