04-05 Spring Syllabus CISB6222-6223

CISB6222/6223 Starting a Business Course Syllabus and Assignments
John F. Terry, Instructor

The Caruth Institute of Owner-Managed Business
Contents
Contact Information Disability Policy Course Description Working with Partners Assignment Criteria Grading Calculations Reading Assignments Class Schedule Assignments and Grading Criteria
Contact Information
Office Phone: Mobile Phone: Email, SMU: Office Hours: Office Location: 972.361.0110 x101 972.489.9597 jterry@mail.cox.smu.edu By Appointment Fincher Building, Room 138
Disability Accommodations
If you need academic accommodations for a disability, you must first contact Ms. Rebecca Marin, Coordinator, Services for Students with Disabilities (214-768-4563) to verify the disability and to establish eligibility for accommodations. Then you must schedule an appointment with the professor to make appropriate arrangements.
Course Description
The objectives of Module A include the following: To provide students with an awareness of what it takes to be a successful entrepreneur and to enhance the analytical skills needed to identify and properly evaluate a new business opportunity. The objectives of Module B are to teach students the skills required to prepare and present a professional business plan for an entrepreneurial venture, and to explore the creation of value through the process of starting a new business venture. Module A will cover topics including: the personal characteristics of successful entrepreneurs; identification of windows of opportunity; development of a viable business concept; preparation of a detailed sales forecast; development of comprehensive financial forecasts; and the evolution of an entrepreneurial strategy. Module B will cover topics including: analysis of competition and market opportunities; creation of a marketing plan for an entrepreneurial venture; selling as a new venture; exploration of financing options for the entrepreneurial company and development of a financing plan; overview of the funding process; equity design and structure; compensation; and preparation and presentation of a professional business plan.
2003 Jerry F. White (original material) John F. Terry (enhancements)
Working with Partners

Students are allowed to work with no more than one partner on the assignments. Partners must be selected at the beginning of the semester, and cannot be changed after work starts on the second assignment (Revenue and Expense Forecasts). Because of the workload in this class, some students find it easier to work with a partner. I would encourage you to do so if there is someone you feel comfortable working with, HOWEVER, bear in mind you will receive the same grade. Also keep in mind this course builds across both modules; if your partner does not take Module B, you will be responsible for completing the Module B assignments (including the business plan) on your own. You cannot choose a new partner in Module B. In summary, you may work together or alone on the first assignment (Opportunity Paper). If you work with a partner on the Opportunity Paper, you may change your business concept once for all future assignments. If you work alone on the Opportunity Paper, you may partner with someone and/or change your business concept once for all future assignments.
Assignment Criteria
To fully appreciate the effort that goes into starting a business, you must work through all aspects of developing and launching the business. Since they are all interrelated (concept > product > marketing > sales > employees > etc.), you must work on a single concept throughout the semester. Recognizing that the investigation of the concept for the Opportunity Paper may uncover facts that make launching the business unattractive however, you may change your business concept ONCE after submitting your Opportunity Paper. The Opportunity Paper you submit will be graded based on how well you complete the assignment, NOT on the validity of the concept. In other words, your analysis and presentation of the concept is the basis for grading, and you will not be penalized if you determine the concept is not viable. Should you choose a different concept going forward, you will be required to submit a second Opportunity Paper along with the second assignment (Revenue and Expense Forecasts). Once you notify me of your decision to change concepts, you must work on your revised concept for the balance of the assignments during the semester. All written assignments are due at the beginning of class on the stated date. Late submissions are penalized at the rate of one letter grade per day. Business plans will not be returned. Please keep a copy for yourself. A detailed evaluation sheet will be provided for each assignment to help you refine your work for subsequent projects.
Grading Calculations
You will receive the grade that you deserve. The number of students to receive each grade will be based on the Cox Schools guidelines concerning grade distributions. A minimum level of performance in each grade component will be required for passing the course. In determining the final course grades, I will add up each students grade on the components, weighted by the appropriate amount. Historically, I then assign the final grades by simply adding up the components, however I reserve the right to adjust the curve and assign the final grades based on natural break points in the distribution. Remember, you are competing with each other for grades, just as you will compete with each other in business.
Assignment weighting is as follows:

Module A
Class Participation Opportunity Overview Paper Revenue and Expense Forecast Financial Statements (Income, Cash Flow and Balance Sheets) Elevator Pitches
10 % 30 % 20 % 25 % 15 % 100 % 10 % 25 % 40 % 25 % 100 %
Total, Module A
Module B
Class Participation Marketing Plan Business Plan Business Plan Presentation
Total, Module B
For each assignment, a curve is established and letter grades are assigned, ranging from A+ to F. For the final module grade, a numerical value is assigned to each letter grade, typically as follows:
L e tte r P o in ts A+ 10 A 9 A8 B+ 7 B 6 B5 C+ 4 C 3 C2 D 1 F 0
Typically, there is no curve for the final grades for each module. Here are some examples of final grade calculations:
Weight Letter Points Weighted Weight Letter Points Weighted
Mod A - Participation - Opportunity Paper - Income Statements - Financial Statements - Elevator Pitch - Final Grade
10% 30% 20% 25% 15% 100%
A A A A A-
9 9 9 9 8 A-
0.90 2.70 1.80 2.25 1.20 8.85
Mod A - Participation - Opportunity Paper - Income Statements - Financial Statements - Elevator Pitch - Final Grade
10% 30% 20% 25% 15% 100%
B B+ A A+ A-
6 7 9 10 8 A-
0.60 2.10 1.80 2.50 1.20 8.20
There are several important points illustrated above. I do give an occasional A+ for perfect assignments (this is not impossible, since you have all of the grading sheets in the syllabus). These are worth more points and can raise you by a half letter grade. In the second example above, an A instead of an A+ on the Financial Statements assignment would have left the student with a B+ for the module instead of an A . Conversely, as shown in the first example, an A in a string of As will bring the overall average down to an A . Papers will be returned to each students folders 10 days after their due date (Monday week following). The class participation grade is determined by ATTENDANCE and verbal or written participation when appropriate. It is YOUR responsibility to sign the attendance sheet each week. This is our official attendance record. Failure to locate and sign the attendance sheet prior to the end of class will result in a recorded absence for that session.
Reading Assignments
The course text is The Portable MBA in Entrepreneurship, Third Edition, by William D. Bygrave, Editor. Some excellent additional information is available in The Entrepreneurs Master Planning Guide, by Jerry White. A copy of The Entrepreneurs Master Planning Guide is on reserve in the BIC. As the book is no longer in publication, it is not necessary to purchase it. Date Topic The Entrepreneurial Process Opportunity Recognition Entry Strategies The Entrepreneur Financial Projections Profit and Cash Flow Sales Forecasting Pages in EMPG* The Portable MBA in Entrepreneurship Chapter 1 Chapter 2 Chapter 3
Class 2
28 68
Class 3
222 - 259 Supplement back of book
Chapter 6
Class 4
The Balance Sheet
260 289
Class 5
Competitive Strategy
69 173
Class 9
Marketing
Chapter 4
Class 10
Entrepreneurs and the Internet
Chapter 13
Class 12
Business Plans Intellectual Property Legal and Tax Issues
1 33 and 298 399
Chapter 5 Chapter 11 Chapter 10
Class 13
Venture Capital Harvesting
Chapter 7 Chapter 14
The Entrepreneurs Master Planning Guide (EMPG) on reserve in the BIC
Class Schedule
Date Class 1 Jan 5 Topic Identifying Opportunities Course Overview Assignments Grading Policy Attendance Policy Opportunities and the Entrepreneur Sources of opportunity Recognizing opportunity Handouts Syllabus Term Project Requirements Opportunity Paper Criteria Opportunity Paper Assessment Survey Form Student Contact Form Class 2 Jan 12 Choosing a Concept The profile of the successful Entrepreneur Do you have what it takes? Some who did Guest Entrepreneur Former SMU student whos launched a successful enterprise Choosing the right business concept for you How successful Entrepreneurs decide Making the decision: What business to start when and where Opportunity Analysis Sales forecasting Selecting a sales forecast methodology Sources of information for sales forecasting Using information technology Forecasting examples using primary and secondary data Profit and cash flow forecasting Forecasting Profit and Cash Flow Calculating the capital needed How growth consumes cash Reducing the capital needed Handouts Assignments Opportunity Overview Assignment 30% of Module A grade Due at the start of Class 3 Elevator Pitch Assignment 15% of Module A grade Due during Class 7
Class 3 Jan 19
Revenue and Expense Forecast Criteria Revenue and Expense Forecast Assessment Speaker and Topic Survey
Opportunity Overview due at start of class Revenue and Expense Assignment 20% of Module A grade Due at the start of Class 5
Date Class 4 Jan 26
Topic Financial Statement Development Revenue and expense modeling Building sales models for different business types Creating an achievable forecast Accurately predicting costs Financial presentation and balance sheets Creating fundable financials Income statements, cash flow statements and balance sheets . . . win friends and impress your accountant
Handouts Handouts Financial Statements Template
Assignments
Class 5 Feb 2
Organizational Design for Entrepreneurs A Small Start-up Case Choosing and communicating your purpose Mission, Vision and Values Choices in organizational structure Guiding principals for new entrepreneurs Recognizing and addressing obstacles to success Competitive Strategy for Entrepreneurs Business concepts and strategy The Economic Experience Curve Three strategies for competitive leadership Perceived customer values Individual Concept Assessment Feedback on concepts Assistance with Financial Statement development
Handouts Speaker and Topic Survey
Revenue and Expense Forecast due at start of class Financial Statements Assignment 25% of Module A grade Due at the start of Class 7
Class 6 Feb 9
Handouts
Class 7 Feb 16
Student Elevator Pitches The Short Pitch Ninety second concept explanations with questions and answers following
Handouts Speaker and Topic Survey
Financial Statements due at start of class Elevator Pitch presented during class
No Class No Final Exam Class 8 Feb 23 End of Module A Spring Break

Date Class 9 Mar 9
Topic Marketing Ogilvy on Advertising How to product advertising that sells Defining the message Choosing a medium Dominating Your Market How Marketing drives Sales Making Marketing decisions Elements of successful Marketing plans Making the Forecast Happen Sales Channel Matching The sales process Personal selling skills Channel characteristics Market characteristics Choosing a channel to match Critical elements of the business plan What should . . . and should not . . . be included in a business plan Avoiding Common Entrepreneurial Errors Corporate Organization Choosing a legal form for your business Benefits and drawbacks of alternatives Equity Architecture Valuing your company Allocating equity based on value Exit Strategies Planning and choosing your exit
Handouts Marketing Plan Criteria Marketing Plan Assessment
Assignments Marketing Plan Assignment 25% of Module B grade Due at the start of Class 11
Class 10 Mar 16
Handouts
Class 11 Mar 23
Business Plan Criteria Business Plan Assessment Business Plan Presentation Criteria Business Plan Presentation Assessment Presenter Sign-up
Marketing Plan due at start of class Business Plan Presentations 25% of Module B grade. Due Class 15 & Class 16 Business Plans 40% of Module B grade Due at the start of Class 15
Class 12 Mar 30
Funding Sources and Expectations Making the Funding Presentation A real pitch Questions you really have to answer Raising Capital Seed money and venture capital Sources of venture capital A framework for deal structuring The Venture Investment Process
Handouts
Date Class 13 Apr 6
Topic Building the Enduring Enterprise Crossing the Chasm Managing rapid change Focusing your growth Making Tough Decisions When things dont go as planned
Handouts
Assignments
Class 14 Apr 13
Business Presentations Student Funding Presentations Five minute pitches with questions and answers following
Presenter Evaluations Speaker and Topic Survey
Business Plan due at start of class Business Plan Pitch presented during class Business Plan Pitch presented during class
Class 15 Apr 20
Business Presentations Student Funding Presentations Five minute pitches with questions and answers following No Class No Final Exam
Presenter Evaluations
Class 16 Apr 27 End of Module B
Assignments and Grading Criteria

Opportunity Overview Paper Revenue and Expense Forecast Financial Statements and Footnotes Brochure and Sales Presentation Marketing Plan Business Plan and Investor Presentation (see following)
Opportunity Paper Assignment CISB6222/6223

John F. Terry
The Caruth Institute for Owner-Managed Business Your assignment is to identify a business opportunity and write a paper about it using the attached headings as indicated. The instructors evaluation form is also attached to further clarify what is required. You may work in teams on this assignment.
Purpose
The best entrepreneurs and venture investors have displayed an ability to avoid wasting a lot of time on poor opportunities and marginal business concepts. This exercise asks you as an individual to do a lot in a short period of time. It defines a basic approach to making a go or no-go decision regarding a proposed business opportunity/concept before the major cost of time and money is committed for due diligence and/or for preparation of a detailed business plan.
Length
Paper must be limited to a maximum of seven typed pages of narrative, plus exhibits. The font can be no smaller than 11 point, margins can be no less than 3/4 inch on all sides, and lines must be spaced 1 lines or greater.
Concept Criteria
Your concept may start as a simple, one-person, even part-time venture but your three year plan must demonstrate growth with the addition of employees, a business location and, by the end of the third year, reasonable profitability. The concept must not be trivial or illegal. It may not be a project on the side. It may not be a real estate or oil and gas development project. It must require not less than $250,000 in investment with no fewer than 5 employees at the end of the third year. In summary, it should have enough mass and complexity that you will get the desired learning at your level of study. You may work on an opportunity for an existing company but this paper should not be oriented toward a continuation of existing business. This effort should encompass opportunity identification as well as evaluation.
Opportunity Paper Outline

Your paper should be organized as follows, responding to the specific grading criteria on the following page: The Opportunity should address questions 6 9 in detail Business Concept should address questions 10 11 in detail Differentiation should address questions 12 14 in detail Operations should address questions 15 17 in detail (dont forget to include org charts) Marketing and Sales should address questions 18 - 21 in detail Finance should address questions 22 28, and include table with financials formatted as follows:
Year 1 Quantity Items Sold Gross Revenue (Quantity Items Sold x Price) Cost of Goods Sold (COGS) Gross Income (Gross Revenue minus Cost of Goods Sold) Selling, General and Administrative Expense (SG&A) EBITDA (Gross Income minus SG&A) Staffing Levels (Total number of Employees at the end of each year) $ $ $ $ $ Year 2 $ $ $ $ $ Year 3 $ $ $ $ $
DO NOT SUBMIT THE ASSIGNMENT IN ANY TYPE OF BINDER; SINGLE STAPLE IN THE CORNER ONLY.
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Opportunity Overview Assessment

CISB6222/6223
See Reverse for comments if any.
Student Name Student Name
Grade
. .
Organization & Presentation 1. 2. 3. 4. 5. Is cover page included with all contact information: name, company, address, phone, and email (fax and web site as available)? Are all fonts 11 points or greater, line spacing 1 lines or greater, and margins or greater? Is paper presented with no binding, single staple in corner, with body of paper limited to 7 pages? Are all cited statistics, facts and data points footnoted correctly referencing the material source, page number/web address and date? Does the paper include the 6 topic headings in the instructions, clearly marked and in order? Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Good Good Good Good Good
Opportunity 6. 7. 8. 9. Is the need for the product or service clearly identified and defined in a manner understandable to customers and investors alike? Is the demand within the target market quantified and supported by documentation, subjective and/or objective? Is the target market well defined by included demographic data, and sufficiently focused (narrow) to validate the demand? How well are substitutes and competitive products described that the target market currently uses to meet the demand (need)? Poor Poor Poor Poor Fair Fair Fair Fair Good Good Good Good Concept 10 . 11 . 12 . 13 . 14 . 15 . 16 . 17 . 18 . 19 . 20 . 21 . 22 . 23 . 24 . 25 . 26 . 27 . 28 . Is the business concept described in clear, accurate terms so that it is easily understandable? Is the business concept as described a viable, defensible alternative to current substitutes and competitive alternatives? How well are the differences and/or improvements of the concept described over existing alternatives? Is there an adequate explanation of how the concept will be defended from competitors and copycats? How well is the value produced by the concept for the target market documented with financial metrics? Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Good Good Good Good Good
Operations Is there an adequate explanation of the resources required to execute the business concept, including associated costs? Are management team qualifications included and suitable for the scale and scope of the business concept? Are three organizational charts included, one for end of each year, all showing growth? Poor Poor Poor Fair Fair Fair Good Good Good
Marketing and Sales Is there an adequate explanation of marketing and advertising efforts, including the reasoning behind sales channel choices? Are competitors identified specifically by name, location, product/service, strengths, weaknesses and positioning? Is there an adequate explanation of pricing strategy for the product/service, including pricing by competitors and substitutes? How will competitors react to the new concepts market entrance, and what will the business concepts response be? Poor Poor Poor Poor Fair Fair Fair Fair Good Good Good Good Finance Is the pro forma financial table included as illustrated in the assignment instructions? Is the year over year growth reasonable for this type of business? Are the total annual revenue levels reasonable for this type of business? Low . Too Fast Too High Too Slow Too . Poor Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good Good
How reasonable is the cost of goods sold (COGS) for this type of business, and is an adequate explanation included? How reasonable is the EBITDA for this type of business, and is an adequate explanation included? Are staffing levels adequate for this type of business and the revenues projected, and is an adequate explanation included? Is there an adequate explanation of the capital needed to launch the business and the rationale?
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Revenue and Expense Forecast CISB6222/6223

John F. Terry
The Caruth Institute for Owner-Managed Business Your assignment is to prepare a three year forecast of revenue and expenses to be turned in on the due date specified in Class Schedule above. The finished project must include: 1.) Income Statement Forecast Accrual Basis Monthly for 36 months Annual Totals Revenue by Category (may be only one category) Detailed Expense Categories Income Tax Considerations Traditional Accounting Format Consolidated Annual Totals Summary Page for all 3 years Explanatory Footnotes Footnotes for each Revenue and Expense Item Methodology for deriving forecast Associated spreadsheets as required to support projections Copy of the Opportunity Overview Corrected or uncorrected from previous assignment
2.)
3.)
See the Sales Forecasting Supplement in the appendix of The Entrepreneurs Master Planning Guide for samples. A special note about depreciation for the forecast: Depreciation is a current expense based on capital equipment purchased that will be used over a long period of time. Use the financial footnote for Depreciation to define the equipment you purchased and the cost, as well as the period of depreciation. Show your monthly depreciation calculation. A LEASE DOES NOT ELIMINATE DEPRECIATION! Capital equipment that is leased for the majority of its useful life must be depreciated just like you own it. The explanatory footnotes are particularly important. Remember, a good accountant should be able to recreate the spreadsheets only from reading the financial footnotes. They must be a separate document and presented as text, NOT as additional cells on a spreadsheet. The finished assignment MUST contain the following pages IN THE FOLLOWING ORDER. Failure to present the assignment as instructed will result in the deduction of one letter grade from the final assignment grade. 1. 2. 3. 4. 5. 6. Cover Page Income Statements, Annual Years 1, 2 and 3, each year showing the total of all line items Income Statement, Monthly with Annual Total, Year 1, Months 1 12, showing all lines items monthly Income Statement, Monthly with Annual Total, Year 2, Months 13 24, showing all lines items monthly Income Statement, Monthly with Annual Total, Year 3, Months 25 36, showing all lines items monthly Explanatory Footnotes (at least 3 pages, one per statement type, may run upwards of 15 pages or more with tables and forecast explanations) 7. Opportunity Overview Paper (does not have to be corrected) NOTE: It is expected that your financial projections may vary significantly from your Opportunity Overview as you further develop your concept and your forecasting becomes more sophisticated.
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Basic Formatting for Monthly Financial Statements CISB6222/6223

John F. Terry
The Caruth Institute for Owner-Managed Business
Month 1 Revenue Item 1 Item 2 Gross Revenue Cost of Goods Sold Gross Income Expenses Wages Employment Taxes Rent Telephone Insurance Depreciation Total Expenses Pretax Profit (Loss) Estimated Income Tax Net Income (Loss) $100 100 200 50 150 50 6 25 5 10 4
Month 2 $100 100 200 50 150 50 6 25 5 10 4
Month 3 $100 100 200 50 150 50 6 25 5 10 4
. . . Totals ... ... ... ... ... ... ... ... ... ... ... $300 300 600 150 450 150 18 75 15 30 12
100 50 17 33
100 50 17 33
100 50 17 33
... ... ... ...
300 150 51 99
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Sample Footnotes for Financial Statements (not complete, examples only) CISB6222/6223
John F. Terry
The Caruth Institute for Owner-Managed Business
COGS (Cost of Goods Sold) Certain costs (expenses) are a direct function of the service delivered, and are recorded as the cost of good sold. Cost of Goods is recorded at the time each transaction is completed: These items include: Consumables: These costs include the disposable materials associated with each test, including EKG monitor points, mouthpieces, paper, cleaning solution and other supplies. Based on information from the equipment manufacturer, these costs are projected to average $10 per test. Details on the number of tests performed each month can be found in Appendix B, Forecasts. Vehicle Expense: These expenses are associated with operating the Company vehicles (vans) used to transport the equipment to and from the client physician sites each day. All Company vehicles are projected to be new, so maintenance is expected to be minimal for the first year. Monthly operating expenses are projected to include an average of $65 per vehicle per month in fuel, with pro rata allowances for filters, wipers, brakes, inspection and tags for a total of $105 per vehicle per month. Tires are expected to last two (2) years, at an average cost of $100 per tire, with $200 allocated in Year 1 and $800 allocated in Year 2 for mishaps. Beginning in Year 3, new tires are budgeted for each vehicle each quarter on a rotating basis. Details on the number of vehicles in service each month can be found in Appendix B, Forecasts. Gross Income: Gross Revenues less the total cost of goods sold.
Expenses Expenses are the costs of producing and delivering the service that are not directly related to the service itself such as selling expenses, overhead items, rent, and salaries and wages. Salaries and Wages: The following positions make up the monthly salary expense for the Company: Position President * Vice-President of Sales * Account Managers * Office Managers * Test Technicians Administrative Assistants Month Starting 1 1 13 1 2 4 Base Salary (Annual) $85,000 85,000 60,000 35,000 30,000 30,000
Salaries increase annually at a rate of five (5%) percent over salaries in the previous year. Positions highlighted with a * will participate in a performance incentive plan annually. Executive salaries (President and Vice President of Sales) are projected to increase to $150,000 in the middle of Year 2 after the Company achieves profitability. A new Account Manager is scheduled to be hired each year beginning in Year 2 to maintain growth. Additional Office Managers will be hired as needed to manage office staffing and claims processing. One Test Technician is hired for each new Mobile Testing Unit (MTU), with an additional staff member in this category providing Test Result Overreads beginning in Month 13. Administrative Assistants are hired to assist Office Managers with scheduling and billing, with a projected requirement of one (1) Administrative Assistant for every twenty (20) client physicians. Staffing levels vary with business growth and are detailed monthly in Appendix B, Forecasts. Employment Taxes: Employment Taxes the Company is responsible for are calculated and paid for each employee as follows: FICA (Social Security, paid on the first $80,400 of earnings): X.X% FICA (Medicare, paid on total annual earnings, no ceiling): X.XX% FUTA (paid on first $X of earnings): X.XX% (includes credit of X.X% for SUTA payments) SUTA (paid on first $X of earnings): X.X% Employees are responsible for a matching contribution of X.XX% of FICA, as well as XX% estimated income tax for each pay period that is withheld and deposited on their behalf.
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15
Revenue and Expense Assessment

CISB6222/6223
Grade
. .
Organization & Presentation 1. 2. 3. 4. 5. 6. 7. Are numbers on the financial statements easily readable? Is the Opportunity Overview included with the Financial Statements? Is the overall assignment professionally presented? Are Annual Summaries for Income Statements portrayed on a separate page? Are Monthly Projections for Income Statements shown on a separate page for each year? Are annual totals included for each line item on each page of Monthly Projections? Are all numbers rounded to the nearest whole dollar? No Poor Poor Fair No Fair No No No Some Good Yes Good Yes Yes Yes Yes
Sales Forecast 8. 9. 10 . 11 . 12 . 13 . 14 . 15 . 16 . 17 . 18 . 19 . 20 . 21 . 22 . 23 . 24 . 25 . 26 . 27 . 28 . 29 . Does the Sales Forecast include variations or seasonality (or a reasonable explanation if not applicable) Does the Sales Forecast include an overall growth trend? Is the year over year growth reasonable for this type of business? Are the total annual revenue levels reasonable for this type of business? Low . Too Fast Too High Too Slow Too . Poor Poor N/A No No Fair Fair Yes Yes Good Good Expenses Is Accounting expense captured and shown on the Income Statement? Are Legal Fees captured and shown on the Income Statement? Is Advertising expense captured and shown as a separate line item on the Income Statement? Is Telephone expense captured and shown as a separate line item on the Income Statement? Is Insurance expense captured and shown as a separate line item on the Income Statement? Is Depreciation expense captured and shown as a separate line item on the Income Statement? Are Rent/Space Lease expenses captured and shown as a separate line item on the Income Statement? Is Workmans Compensation insurance expense captured and shown on the Income Statement? Is the Cost of Goods Sold captured and shown as a separate item on the Income Statement? Is Pre-tax Profit reasonable for this type of business? Are Payroll and Income Taxes captured and shown each month? Are Income Taxes shown as a negative number in any month? Too High Too Low . N/A N/A N/A Poor Poor No No No No No No No No No Fair Fair No Yes Yes Yes Yes Yes Yes Yes Yes Yes Good Good Yes
Financial Footnotes Are Financial Footnotes organized and easy to follow? Are detailed assumptions included to support sales forecast? Are footnotes to the Income Statement thorough? Is Depreciation adequately explained and calculated correctly? Is a Capital Expenditures table/explanation included? Are Payroll Taxes adequately explained? Are Income Taxes adequately explained? FICA rate FUTA rate SUTA (TWC) rate . Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good
16
Financial Statements Assignment CISB6223/6223

John F. Terry
The Caruth Institute for Owner-Managed Business Your assignment is to prepare forecasts for income, cash flow, and balance sheets to be submitted on the specified due date. The finished project must include: 1.) Income Statement Forecast A copy of your prior project developing Income Statements with any new information youve uncovered. These should include your financial footnotes, and must support the Cash Flow and Balance Sheet Statements you submit as part of this assignment. Cash Flow Forecast Receipts & Disbursements basis; Monthly for 36 months Annual totals Explanatory footnotes for each line item. Balance Sheet Forecast: As of the end of each 12 month period Explanatory footnotes, including those developed for the prior assignment (Income Statements), with additional pages to explain Cash Flow and Balance Sheet Statement Line items. Use current applicable tax rates (IRS, State of Texas, City, County, etc.) and realistic numbers. The specific organization of the contents will be:
2.) 3.) 4.)
Cover Page Annual Summaries of Income Statements (each line item, totals for Year 1, Year 2, and Year 3 one single page, vertical format) Annual Summaries of Cash Flow Statements (each line item, totals for Year 1, Year 2, and Year 3 one single page, vertical format) Annual Summaries of Balance Sheet Statements (each line, end of year for Year 1, Year 2, and Year 3 one single page, vertical format) Income Statement Year 1 (each line item, each month for 12 months plus annual totals, horizontal) Cash Flow Statement Year 1 (each line item, each month for 12 months plus annual totals, horizontal) Income Statement Year 2 (each line item, each month for 12 months plus annual totals, horizontal) Cash Flow Statement Year 2 (each line item, each month for 12 months plus annual totals, horizontal) Income Statement Year 3 (each line item, each month for 12 months plus annual totals, horizontal) Cash Flow Statement Year 3 (each line item, each month for 12 months plus annual totals, horizontal) Footnotes to Income Statements (written explanation of the calculations for each line item, not just spreadsheet cells) Footnotes to Cash Flow Statements (written explanation of the calculations for each line item, not just spreadsheet cells) Footnotes to Balance Sheet Statements (written explanation of non-obvious line items, not just spreadsheet cells) Copy of Opportunity Overview, corrected or uncorrected
Failure to present the assignment as instructed will result in the deduction of one letter grade from the final assignment grade. Professional presentation, organization, quality of thinking, degree of detail, credibility of numbers, and technical accuracy will be considered in evaluating your work.
17
Financial Statements Assessment

CISB6222/6223
Grade
. .
Organization & Presentation 1. 2. 3. 4. 5. 6. 7. 8. 9. 10 . 11 . 12 . 13 . 14 . 15 . 16 . 17 . 18 . 19 . 20 . 21 . 22 . 23 . 24 . 25 . 26 . 27 . 28 . 29 . 30 . 31 . 32 . 33 . 34 . Are numbers on the financial statements easily readable? Is the Opportunity Overview included with the Financial Statements? Is the overall assignment professionally presented? Are Annual Summaries for Income Statements, Cash Flows, and Balance Sheets each portrayed on a separate page (3 pages total)? Are Monthly Projections for Income Statements and Cash Flows shown on a separate page for each year? Are annual totals included for each line item on each page of Monthly Projections? Are all numbers rounded to the nearest whole dollar? Does the Sales Forecast include variations or seasonality (or a reasonable explanation if not applicable) Does the Sales Forecast include an overall growth trend? Is the year over year growth reasonable for this type of business? Are the total annual revenue levels reasonable for this type of business? Low . Is Accounting expense captured and shown on the Income Statement? Are Legal Fees captured and shown on the Income Statement? Is Advertising expense captured and shown as a separate line item on the Income Statement? Is Telephone expense captured and shown as a separate line item on the Income Statement? Is Insurance expense captured and shown as a separate line item on the Income Statement? Is Depreciation expense captured and shown as a separate line item on the Income Statement? Are Rent/Space Lease expenses captured and shown as a separate line item on the Income Statement? Is Workmans Compensation insurance expense captured and shown on the Income Statement? Is the Cost of Goods Sold captured and shown as a separate item on the Income Statement? Is Pre-tax Profit reasonable for this type of business? Are Payroll and Income Taxes captured and shown each month? Are Payroll Taxes and Employee Withholding calculated and deposits shown differently on Income Statements and Cash Flows? Are Income Taxes always shown as positive or 0? (no negative numbers shown for income tax) Too High Too Low . N/A N/A N/A Poor Poor Poor Too Fast Too High Too Slow Too . Poor Poor No N/A Poor Poor Fair No Fair No No No Some No No Fair Fair Good Yes Good Yes Yes Yes Yes Yes Yes Good Good Expenses No No No No No No No No No Fair Fair Fair No Yes Yes Yes Yes Yes Yes Yes Yes Yes Good Good Good Yes
Sales Forecast
Cash Flow Statements Is Cash Flow opening balance $0 in Month 1 and Year 1? Is Cash Flow ending balance the same as beginning balance the following year? Is the ending cash balance positive in every month shown on the Cash Flow Statements? Is the summing of opening balances and ending balances omitted in the yearly totals on the Cash Flow Statements? No No No No Yes Yes Yes Yes
Balance Sheet Statements Are Balance Sheet Statements included? Are Accounts Payable included as a separate line item on the Balance Sheet? Are Accounts Receivable included as a separate line item on the Balance Sheet? Is Depreciation captured and shown as a separate line item on the Balance Sheet? Is it accumulated annually? Is a reasonable level of inventory portrayed on the Balance Sheet for the type of business? Are Retained Earnings and Paid-in Capital/Common Stock captured and shown as separate line items on the Balance Sheet? N/A Poor N/A No No No Fair No No Yes Yes Yes Good Yes Yes
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35 . 36 . 37 . 38 . 39 . 40 . 41 . 42 . 43 . 44 . 45 .
Does the Cash position on the Balance Sheet correspond with the ending cash position on the annual Cash Flow Statement? Does the cash invested equal the Paid-in Capital/Common Stock shown on the Balance Sheet? Does Net Income (after-tax) from the Income Statement correspond with Retained Earnings on the Balance Sheet? Does the Balance Sheet balance? (other balance sheet items must be checked Yes for this to occur)
No No No No
Yes Yes Yes Yes
Financial Footnotes Are Financial Footnotes organized and easy to follow? Are separate sections included for each type of statement? (Income, Cash, etc) Are detailed assumptions included to support sales forecast? Are footnotes to the Income Statement thorough? Is Depreciation adequately explained and calculated correctly? Is a Capital Expenditures table/explanation included? Are Payroll Taxes adequately explained? Are Income Taxes adequately explained? Is there a clear explanation of the rationale for Accounts Payable and Accounts Receivable in the Balance Sheet Footnotes? FICA rate FUTA rate SUTA (TWC) rate . Poor Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good Good
19
Elevator Pitch Assignment CISB6222/6223

John F. Terry
The Caruth Institute for Owner-Managed Business Elevator Pitch is a term used to describe a brief, compelling explanation of a concept or a business, intended to take less than a minute (a proxy for the travel time of an elevator between floors). Initially intended to interest venture capitalists, it is now used in a variety of situations, including by job applicants to interest employers and during speed dating to interest prospective dates. The concept is based on the old adage You never get a second chance to make a first impression and the research that indicates people make up their minds about you within the first few minutes of meeting you. What is said and how it is said is critical to extending the conversation and generating interest in funding, prospective employees, vendors or partners. Your assignment is to develop and deliver a compelling 90 second elevator pitch to the class. It is critical that you stay on time. A time keeper will start your pitch and stop you at exactly the 90 second mark REGARDLESS of whether or not you are finished. Three of your peers and the instructor will evaluate your pitch and provide immediate feedback during the class period. If you are working with a partner, only one of you is required to make the pitch. Your elevator pitch will be judged on the following eight criteria: 1. 2. 3. 4. 5. 6. 7. 8. How well did you understand the business of the company? How apparent is the need for the products or services based on the pitch? How clearly defined are the customers for the product or service? How obvious are the benefits to the customers? Is there a clear value? How well is the product or service differentiated from substitutes and competitive offerings? How viable do you consider the concept based on what you heard? Was the pitch clear and intriguing? Did you want to hear more? How professional was the pitch? Was it finished on time without rushing?
Scoring will be based on the following scale: 5 Very well done; Excellent 4 Above average 3 Good 2 Fair 1 Poor
Your final grade will be determined by the instructors score, weighted 40%, the average of your three peers scores, weighted 40%, and the instructors assessment of your grading of your peers, weighted 20%. The secret to success in making an elevator pitch is to practice . . . practice, practice, practice. It will be obvious when you make your pitch and are compared with your peer group who has practiced and who has not, and grades will reflect your preparation. Write it out, memorize it, then refine your pace, hand gestures, and body language. This is simply a speaking assignment; do not prepare or use PowerPoint slides or props for your elevator pitch.
20
Student Elevator Pitch Assessment

CISB6222/6223
Grading Student Name
Scoring: Higher is better. 5 is Excellent, 4 is Above Average, 3 is Good, 2 is Fair, 1 is Poor.

Pitch # 1 1. 2. 3. 4. 5. 6. 7. 8. Student Name . Scoring
How well did you understand the business of the company? How apparent is the need for the products or services based on the pitch? How clearly defined are the customers for the product or service? How obvious are the benefits to the customers? Is there a clear value? How well is the product or service differentiated from substitutes and competitive offerings? How viable do you consider the concept based on what you heard? Was the pitch clear and intriguing? Did you want to hear more? How professional was the pitch? Was it finished on time without rushing? TOTAL POINTS (maximum of 40 possible)
Pitch # 2 1. 2. 3. 4. 5. 6. 7. 8.
Student Name
Scoring
Pitch # 3 1. 2. 3. 4. 5. 6. 7. 8.
Student Name
Scoring
21
Instructor Elevator Pitch Assessment

CISB6222/6223
Grade
. .
Scoring: Higher is better. 5 is Excellent, 4 is Above Average, 3 is Good, 2 is Fair, 1 is Poor.

Instructor 1. 2. 3. 4. 5. 6. 7. 8. How well did you understand the business of the company? How apparent is the need for the products or services based on the pitch? How clearly defined are the customers for the product or service? How obvious are the benefits to the customers? Is there a clear value? How well is the product or service differentiated from substitutes and competitive offerings? How viable do you consider the concept based on what you heard? Was the pitch clear and intriguing? Did you want to hear more? How professional was the pitch? Was it finished on time without rushing? TOTAL POINTS (maximum of 40 possible) Average of Peer Evaluations 1. 2. 3. 4. 5. 6. 7. 8. How well did you understand the business of the company? How apparent is the need for the products or services based on the pitch? How clearly defined are the customers for the product or service? How obvious are the benefits to the customers? Is there a clear value? How well is the product or service differentiated from substitutes and competitive offerings? How viable do you consider the concept based on what you heard? Was the pitch clear and intriguing? Did you want to hear more? How professional was the pitch? Was it finished on time without rushing? TOTAL POINTS (maximum of 40 possible) Instructor Assessment of Peer Ratings and Classroom Comments TOTAL POINTS (maximum of 20 possible) Scoring Scoring Scoring
TOTAL POINTS, ALL CATEGORIES (maximum of 100 possible)
22
Marketing Plan Assignment CISB6222/6223

John F. Terry
The Caruth Institute for Owner-Managed Business Most companies fail because they run out of money. Most companies run out of money because they fail to achieve sales goals. Marketing and selling your concept is critical to your future success as an entrepreneur. The purpose of this assignment is to encourage you to think through the market/marketing/sales issues of your new venture. For this assignment, the substance of your responses to the questions is more important than presenting a formal document called "Marketing Plan." This work will be incorporated into the finished business plan. This assignment is due at the beginning of class on the due date specified in Class Schedule above. The assignment should be organized as follows, responding to the grading criteria on the following page: Product/Service and Positioning should address questions 6 10 in detail Market Analysis should address questions 11 16 in detail Sales and Marketing Strategies should address questions 17 22 in detail Competitive Assessment should address questions 23 26 in detail Marketing Budget should address questions 27 28 in detail
Your market analysis should include macro factors as well as micro factors (is the market growing, is competition growing, is there consolidation, what is the regulatory environment like, are there economic threats, etc.) For each of your marketing decisions, include the why you are choosing to do it that way, not just what you are choosing to do. Your marketing budget should be broken out annually, with categories for each expenditure. All of this has already been captured in your financial statements if done correctly, however it is typically scattered across several categories, making it difficult to evaluate marketing expenditures and necessitating this budget. Your marketing budget should include (as you see appropriate) categories for: Sales people (including any perks, benefit costs and commissions) Commissions to third parties Literature Travel related to sales Entertainment Trade shows Advertising of all types Promotion event expenses PR firm expenses Marketing firm expenses Advertising agency expenses
Like the Financial Statements Assignment incorporated the work done on the Revenue and Expense Assignment, you will pull certain information from your Opportunity Overview to incorporate in your Marketing Plan. Presumably the concept has been refined, and the Marketing Plan information is more specific, but in some cases it may be identical.
23
24
Marketing Plan Assessment

CISB6222/6223
Grade
. .
Organization & Presentation 1. 2. 3. 4. 5. Is cover page included with all contact information: name, company, address, phone, and email (fax and web site as available)? Are all fonts 11 points or greater, line spacing 1 lines or greater, and margins or greater? Is paper presented with no binding, single staple in corner, with body of paper limited to 10 pages? Are all cited statistics, facts and data points footnoted correctly referencing the material source, page number/web address and date? Does the paper include the 5 topic headings in the instructions, clearly marked and in order? Poor Poor Poor Poor Fair Fair No Fair Fair Good Good Yes Good Good
Product/Service and Positioning 6. 7. 8. 9. 10 . 11 . 12 . 13 . 14 . 15 . 16 . 17 . 18 . 19 . 20 . 21 . 22 . 23 . 24 . 25 . 26 . 27 . 28 . Is the Mission Statement included at the beginning of the marketing plan? Does the Mission Statement provide a clear charter for the organization? Is it specific enough to guide employee decisions? Is the product/service description written in compelling marketing language, suitable as a basis for advertising and marketing efforts? Are the features of the product/service clearly identified and described? Are the benefits of the product/service clearly identified and described, tied to the specific features that create the benefits? Poor Poor Poor Poor No Fair Fair Fair Fair Yes Good Good Good Good
Market Analysis Is a detailed, comprehensive analysis of the market situation describing elements driving demand included? Does the market situation analysis include insight as to how and why customers make purchasing decisions for this product/service? Are detail and statistics regarding the total available market included? Are detail and statistics regarding the target market included with an explanation of how they are different from the total market? Is a rational assessment of market share/capture included along with an explanation supporting the conclusions? Is the effect of geography on the market and expansion plans explained? (including location choice and rationale for retail concepts) Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good
Sales and Marketing Strategies Is a detailed discussion of marketing strategies included with an explanation of the rationale for selecting these strategies? Does the marketing strategy include an explanation of pricing strategy? (how pricing is set, not just a comparison of competitors) Do the marketing strategies include a comprehensive discussion of the selling approach? - Choice of sales channels and rationale? - Specific media identified by name, frequency and type for advertising? - Promotion and PR opportunities identified and discussed? Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good
Competitive Assessment Are direct competitors identified specifically by name, location, product/service, strengths, weaknesses and positioning? Are indirect competitors identified specifically by name, location, product/service, strengths, weaknesses and positioning? How will competitors react to the new concepts market entrance, and what will the business concepts response be? What are the competitive advantages of business concept, and are they defensible and legitimate? Poor Poor Poor Poor Fair Fair Fair Fair Good Good Good Good
Marketing Budget Does the marketing budget break out all sales and marketing costs and include an explanation for the three year period? Is the sales and marketing spend adequate to support the projected market penetration? Poor Poor Fair Fair Good Good
25
Business Plan Assignment CISB6222/6223

John F. Terry
The Caruth Institute for Owner-Managed Business Your assignment, using all the material you have developed in prior assignments, is to assemble a cohesive business plan. Most of the material needed has already been developed. New material to be developed for this assignment will be: 1. An Executive Summary (no more than 2 pages in length) 2. Operations and Organization information (employee positions and responsibilities, management roles) 3. A brief introduction to your Financials, including equity structure and exit strategies Additionally, you will need to correct and update any material from previous assignments. You must organize and work through all the material so it presents a cohesive picture of your business; simply assembling previous assignments will not be adequate. The final business plan is due on the date noted in Class Schedule above. NO EXCEPTIONS ARE ALLOWED ON DUE DATE. ONE COPY IS REQUIRED IT REMAINS IN INSTITUTE FILES AND WILL NOT BE RETURNED. Your plan will contain a minimum of three years of financial projections. Income and Cash Flow Forecasts will be month-by-month for the first 36 months. Monthly projections must include annual totals and all numbers must be rounded to the nearest whole dollar. A balance sheet must be prepared as of the end of each year. Income and Cash Flow forecasts must be accompanied by detailed footnotes (i.e., for each line item of the forecasts). Balance Sheets will have footnotes as needed to explain items that may not be obvious. Your plan must contain concise information about your business concept, your target market and marketing plans, the competition, your management, your organization, your operations plan, and any other information that you feel would be pertinent in convincing a knowledgeable investor to back your business. The plan must begin with an Executive Summary, followed by a table of contents, with all pages numbered accordingly. Important elements in the evaluation of your business plan include:
Conciseness and Clarity Get right to the point without rambling and convey your ideas with focus and logic.
Documentation Documentation primarily involves the footnotes to the financial statements and how well you substantiate and explain your numbers. Measuring your market may also require documentation. Credibility How reasonable and believable is your business concept? How believable are your sales forecast and profit margin? How well have you described your total market, target market, marketing plan, and competition? Is the overall plan realistic in light of your management teams track record and available resources.
Accuracy and format of financial statementsDo your balance sheets balance? Have you made obvious mathematical errors? Are your statements in good accounting form? Do your Income and Cash Flow forecasts correlate with the Balance Sheet? Appearance Plan must be neatly typed and professional. Spelling or other errors will reduce your grade.
Plans will be laser printed and GBC bound. This type of binding is available at Kinkos, Alphagraphics, and Impressions. THIS IS DIFFERENT FROM ALL PREVIOUS ASSIGNMENTS! The financial forecasts will be presented in a 8 X 11 format with 12 months of income and cash flow projections, plus annual totals, on one page for each of the 3 years. This is a total of 9 pages, presented in the same order as your previous assignment.
26
Business Plan Assessment

CISB6223/6223
Grade
. .
Organization & Presentation 1. 2. 3. 4. 5. 6. 7. 8. 9. 10 . 11 . 12 . 13 . 14 . 15 . 16 . 17 . 18 . 19 . 20 . 21 . 22 . 23 . 24 . 25 . 26 . 27 . 28 . 29 . 30 . 31 . 32 . 33 . 34 . Is Securities Disclaimer included on the Title Page? Is complete Contact Information included on the Title Page, including name, company, address, phone, and email? Is a Table of Contents included? Are the pages numbered? Is the Executive Summary included in the front, limited to 3 pages max, with reasonable margins, fonts and spacing? Are Management Resumes included as an Appendix? Are all cited statistics, facts and data points footnoted correctly referencing the material source, page number/web address and date? Is non-critical Business Plan information organized and accessible in appendices? Are numbers on the financial statements easily readable? Are Annual Summaries for Income Statements, Cash Flows, and Balance Sheets each portrayed on a separate page (3 pages total)? Are Monthly Projections for Income Statements and Cash Flows shown on a separate page for each year? Are annual totals included for each line item on each page of Monthly Projections? Are all numbers rounded to the nearest whole dollar? Quality of Typing/Spelling/Grammar, all fonts 11 points or greater, line spacing 1 lines or greater, and margins or greater? Overall Professionalism of Business Plan Packaging and Presentation No Poor Poor Poor No N/A N/A Poor No No No No Fair Some No No Fair No No No Some Fair Fair Yes Yes Yes Yes Good Yes Yes Yes Good Yes Yes Yes Yes Good Good
Executive Summary Is the Concept described in adequate detail in the Executive Summary? Is the Opportunity discussed, including market and marketing information, in the Executive Summary? Is Management Information with relevant experience provided in the Executive Summary? Is Financial Information, including projected annual revenues, profits, and financing needs, shown in the Executive Summary? Poor Poor Poor Poor Fair Fair Fair Fair Good Good Good Good
Business Concept Is the need for the product or service clearly identified and defined in a manner understandable to customers and investors alike? Is the business concept described in clear, accurate terms so that it is easily understandable? Is the business concept as described a viable, defensible alternative to current substitutes and competitive alternatives? How well are the differences and/or improvements of the concept described over existing alternatives? How well is the value produced by the concept for the target market documented with financial metrics? Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Good Good Good Good Good
Marketing Does the Mission Statement provide a clear charter for the organization? Is it specific enough to guide employee decisions? Are the features of the product/service clearly identified and described? Are the benefits of the product/service clearly identified and described, tied to the specific features that create the benefits? Is a detailed, comprehensive analysis of the market situation describing elements driving demand included? Are detail and statistics regarding the total available market included? Are detail and statistics regarding the target market included with an explanation of how they are different from the total market? Is a rational assessment of market share/capture included along with an explanation supporting the conclusions? Is the effect of geography on the market and expansion plans explained? (including location choice and rationale for retail concepts) Is a detailed discussion of marketing strategies included with an explanation of the rationale for selecting these strategies? Does the marketing strategy include an explanation of pricing strategy? (how pricing is set, not just a comparison of competitors) Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good Good Good Good Good
27
Do the marketing strategies include a comprehensive discussion of the selling approach? 35 . 36 . 37 . 38 . 39 . 40 . 41 . 42 . - Choice of sales channels and rationale? - Specific media identified by name, frequency and type for advertising? - Promotion and PR opportunities identified and discussed? Are direct competitors identified specifically by name, location, product/service, strengths, weaknesses and positioning? Are indirect competitors identified specifically by name, location, product/service, strengths, weaknesses and positioning? How will competitors react to the new concepts market entrance, and what will the business concepts response be? What are the competitive advantages of business concept, and are they defensible and legitimate? Is the sales and marketing spend adequate to support the projected market penetration? Too High Too Low . Poor Poor Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good Good Good
28
Operations 43 . 44 . 45 . 46 . 47 . 48 . 49 . 50 . 51 . 52 . 53 . 54 . 55 . 56 . 57 . 58 . 59 . 60 . 61 . 62 . 63 . 64 . 65 . 66 . 67 . 68 . 69 . 70 . 71 . 72 . 73 . 74 . 75 . Is there an adequate explanation of the resources required to execute the business concept, including associated costs? Are all management team qualifications included and suitable for the scale and scope of the business concept? Detailed explanation of Financing Plan Is a legal entity specified, including details of ownership, with a rationale for choosing that type of entity? Detailed description of the Exit Strategy Poor No Poor Poor Poor Fair Some Fair Fair Fair Good Yes Good Good Good
Sales Forecast Does the Sales Forecast include variations or seasonality (or a reasonable explanation if not applicable) Does the Sales Forecast include an overall growth trend? Is the year over year growth reasonable for this type of business? Are the total annual revenue levels reasonable for this type of business? Too Fast Too High Too Slow Too Low . . Poor Poor N/A No No Fair Fair Yes Yes Good Good Expenses Is Accounting expense captured and shown on the Income Statement? Are Legal Fees captured and shown on the Income Statement? Is Advertising expense captured and shown as a separate line item on the Income Statement? Is Telephone expense captured and shown as a separate line item on the Income Statement? Is Insurance expense captured and shown as a separate line item on the Income Statement? Is Depreciation expense captured and shown as a separate line item on the Income Statement? Are Rent/Space Lease expenses captured and shown as a separate line item on the Income Statement? Is Workmans Compensation insurance expense captured and shown on the Income Statement? Is the Cost of Goods Sold captured and shown as a separate item on the Income Statement? Is Pre-tax Profit reasonable for this type of business? Are Payroll and Income Taxes captured and shown each month? Are Payroll Taxes and Employee Withholding calculated and deposits shown differently on Income Statements and Cash Flows? Are Income Taxes always shown as $ 0 or a positive number? (never shown as a negative number) Too High Too Low . N/A N/A N/A Poor Poor Poor No No No No No No No No No Fair Fair Fair No Yes Yes Yes Yes Yes Yes Yes Yes Yes Good Good Good Yes
Cash Flow Statements Is Cash Flow opening balance $0 in Month 1 and Year 1? Is Cash Flow ending balance the same as beginning balance the following year? Is the ending cash balance positive in every month shown on the Cash Flow Statements? Is the summing of opening balances and ending balances omitted in the yearly totals on the Cash Flow Statements? No No No No Yes Yes Yes Yes
Balance Sheet Statements Are Balance Sheet Statements included? Are Accounts Payable included as a separate line item on the Balance Sheet? Are Accounts Receivable included as a separate line item on the Balance Sheet? Is Depreciation captured and shown as a separate line item on the Balance Sheet? Is it accumulated annually? Is a reasonable level of inventory portrayed on the Balance Sheet for the type of business? Are Retained Earnings and Paid-in Capital/Common Stock captured and shown as separate line items on the Balance Sheet? Does the Cash position on the Balance Sheet correspond with the ending cash position on the annual Cash Flow Statement? N/A Poor N/A No No No Fair No No No Yes Yes Yes Good Yes Yes Yes
29
76 . 77 . 78 . 79 . 80 . 81 . 82 . 83 . 84 . 85 .
Does the cash invested equal the Paid-in Capital/Common Stock shown on the Balance Sheet? Does Net Income (after-tax) from the Income Statement correspond with Retained Earnings on the Balance Sheet? Does the Balance Sheet balance? (other balance sheet items must be checked Yes for this to occur)
No No No
Yes Yes Yes
Financial Footnotes Are Financial Footnotes organized and easy to follow? Are separate sections included for each type of statement? (Income, Cash, etc.) Are detailed assumptions included to support sales forecast? Are footnotes to the Income Statement thorough? Is Depreciation adequately explained and calculated correctly? Is a Capital Expenditures table/explanation included? Are Payroll Taxes adequately explained? Are Income Taxes adequately explained? Is there a clear explanation of the rationale for Accounts Payable and Accounts Receivable in the Balance Sheet Footnotes? FICA rate FUTA rate SUTA (TWC) rate . Poor Poor Poor Poor Poor Poor Poor Fair Fair Fair Fair Fair Fair Fair Good Good Good Good Good Good Good
30

04-05 Spring Syllabus CISB6222-6223

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CISB6222/6223 Starting a Business Course Syllabus and Assignments

John F. Terry, Instructor

2003 Jerry F. White (original material) John F. Terry (enhancements)

2003 Jerry F. White (original material) John F. Terry (enhancements)

Working with Partners

2003 Jerry F. White (original material) John F. Terry (enhancements)

Assignment weighting is as follows:

Class Participation Marketing Plan Business Plan Business Plan Presentation

10% 30% 20% 25% 15% 100%

0.90 2.70 1.80 2.25 1.20 8.85

10% 30% 20% 25% 15% 100%

0.60 2.10 1.80 2.50 1.20 8.20

2003 Jerry F. White (original material) John F. Terry (enhancements)

222 - 259 Supplement back of book

The Balance Sheet

Entrepreneurs and the Internet

Business Plans Intellectual Property Legal and Tax Issues

1 33 and 298 399

Chapter 5 Chapter 11 Chapter 10

Venture Capital Harvesting

The Entrepreneurs Master Planning Guide (EMPG) on reserve in the BIC

2003 Jerry F. White (original material) John F. Terry (enhancements)

2003 Jerry F. White (original material) John F. Terry (enhancements)

Date Class 4 Jan 26

Handouts Handouts Financial Statements Template

Handouts Speaker and Topic Survey

Handouts Speaker and Topic Survey

No Class No Final Exam Class 8 Feb 23 End of Module A Spring Break

Date Class 9 Mar 9

Handouts Marketing Plan Criteria Marketing Plan Assessment

2003 Jerry F. White (original material) John F. Terry (enhancements)

Date Class 13 Apr 6

Presenter Evaluations Speaker and Topic Survey

Class 16 Apr 27 End of Module B

Assignments and Grading Criteria

2003 Jerry F. White (original material) John F. Terry (enhancements)

Opportunity Paper Assignment CISB6222/6223

Opportunity Paper Outline

2003 Jerry F. White (original material) John F. Terry (enhancements)

Opportunity Overview Assessment

Student Name Student Name

2003 Jerry F. White (original material) John F. Terry (enhancements)

Revenue and Expense Forecast CISB6222/6223

Basic Formatting for Monthly Financial Statements CISB6222/6223

Month 2 $100 100 200 50 150 50 6 25 5 10 4

Month 3 $100 100 200 50 150 50 6 25 5 10 4

... ... ... ...

2003 Jerry F. White (original material) John F. Terry (enhancements)

2003 Jerry F. White (original material) John F. Terry (enhancements)

2003 Jerry F. White (original material) John F. Terry (enhancements)

Revenue and Expense Assessment

Student Name Student Name

2003 Jerry F. White (original material) John F. Terry (enhancements)

Financial Statements Assignment CISB6223/6223

2.) 3.) 4.)

2003 Jerry F. White (original material) John F. Terry (enhancements)

Financial Statements Assessment

Student Name Student Name

2003 Jerry F. White (original material) John F. Terry (enhancements)

Yes Yes Yes Yes

2003 Jerry F. White (original material) John F. Terry (enhancements)

Elevator Pitch Assignment CISB6222/6223

2003 Jerry F. White (original material) John F. Terry (enhancements)