1. © 2017 Junior Achievement USA® All rights reserved.
JA Academy
Track and Manage a Financial Plan
© 2017 Junior Achievement USA® All rights reserved.

2. Warm-Up
It All Adds Up

3. Cash Flow | Cayla’s Birthday Weekend
How much birthday money does Cayla have left?
Friday
Sunday
Saturday
Gift From Grandma
+ $50
Buys Jeans
- $50
Gift from
Uncle
+ $25
Lunch
- $15
Amusement Park
- $40
Gift from Aunt Kim
+ $20
Gift from Aunt Rose
Souvenir
-$7
Buys Ice Cream
- $4
GIFT FROM FAMILY FRIEND
+10

4. I will
manage a financial plan by creating a balance sheet and an income statement for a business scenario.
compare and contrast the balance sheet and an income statement.
identify methods for tracking finances.

5. discuss
It’s All About Balance

6. Components of a Financial Plan
Break-Even Analysis
Cash Flow Statement
Income Statement
Balance Sheet

7. Components of a Financial Plan
Break Even Analysis: a computation of the point of production at which income from sales equals total fixed and variable costs.
Balance Sheet: a report of a company’s assets, liabilities, and net worth on a specific date.
Income Statement/Profit-Loss Statement: shows how much revenue came in and costs and expenses associated with earning that revenue over set period of time.
Cash Flow Statement: analyzes the cash flow in and out of a company.

8. Balance Sheets
This equation identifies the value of the company in terms of its equity or net worth at a given time. = =
Assets
Liabilities
Equity (Net Worth)
Cash Reserves
Company Car
Copy Machine
Insurance
Rent
Loan Interest ?

9. Assets & Liabilities
Liquid/Current Assets: Assets that can be quickly converted to cash. Examples: cash in bank, accounts receivable, inventory, supplies.
Fixed Assets: Assets that can NOT be quickly converted to cash. Examples: property and equipment (land, buildings, car, machines)
Short Term/Current Liabilities: Debts that will be paid in less than one year. Examples are: accounts payable, payroll, rent.
Long Term Liabilities: debts that will take longer than one year to pay. Examples: Equipment loans, mortgage, car loans.

10. How Much Equity?
What is the equity of this company that offers printing and delivery services?
To figure it out, subtract liabilities from assets. = =
Assets
Assets
Liabilities
Liabilities
Equity (Net Worth)
Equity (Net Worth)
Cash Reserves = $1,000
Company Car = $15,000
Copy Machine = $3,000
Insurance = $3,000
Rent = $500
Loan Interest = $300
$15,200
Reveal
Reveal
Reveal

11. Assets = Liabilities + Equity
Balance Means Balance
Example: A business takes out a loan to buy equipment costing $4,000.
Add $4,000 of equipment to its list of assets.
Add $4,000 to its liabilities due to the long-term loan.
Assets = Liabilities + Equity
Assets should balance with liabilities and equity.

12. TEDDY FAB INC. BALANCE SHEET LIABILITIES ASSETS
December 21, 2100
LIABILITIES
Current Liabilities
Accounts Payable
Payroll
Long Term Debt
Bank Loan
30,000
5,000
200,000
Total Current Liabilities
235,000
ASSETS
Current Assets (Liquid)
Cash and cash equivalents
Accounts receivable
Inventory
Prepaid expense
$100,000
20,000
15,000
4,000
Total current assets
$139,000
Property and Equipment (Fixed)
Land
Buildings and improvements
Equipment
Less accumulated depreciation
24,300
250,000
50,000
-5,000
OWNER´S EQUITY
$223,300
Total Liabilities and Equity
$458,300
Total Assets
$458,300

13. Get together
Jacy’s Balance Sheet

14. Jacy’s Coffee and Sweets
Join your group.
Complete the Activity: Get Together: Jacy’s Balance Sheet
Determine if each entry is an Asset or Liability. Record your decision in the activity sheet.
Using the provided numbers, create a pro-forma balance sheet for Jacy’s first month of business.
Jacy’s Coffee and Sweets
PRO-FORMA BALANCE SHEET
January 31, 2021
ASSETS
Current Assets (Liquid)
Total current assets
LIABILITIES
Current Liabilities
Long Term Debt
Total Liabilities
Fixes assets
Total Assets
OWNER´S EQUITY
Total Liabilities and Equity

15. discuss
Profit or Loss

16. Income Statement
An income statement shows how much money a company made (or lost) over a period of time. = =
Income
Expenses
Net Income or Loss
Sales
Donations
Goods
Payroll
Rent ?

17. = = $1,800 What’s the Bottom Line?
What is the net income for the year for this printing company? = =
Income
Income
Expenses
Expenses
Net Income or Loss
Net Income or Loss
Sales = $13,000
Donations = $1,000
Goods = $3,000
Payroll = $12,500
Rent = $300
$1,800
Reveal
Reveal
Reveal

18. Sample Products Co. Income Statement Total Income/Revenue
For the 5 months ending May 31,2016
Total Income/Revenue
$100,000
-65,000
35,000
1,000
Sales Revenue
Cost of Goods Sold
Gross Margin
Business Grant Received
Income/Revenue
$36,000
Commissions Expense
Office Supplies Expense
Office Equipment Expense
Advertising Expenses
Total Operating Expense
$5,000
3,500
2,500
2,000
Operating Expenses
$13,000
Total Income – Total Expense
Less Income Taxes (30%)
$23,000
($6,900.0)
Earnings Before Income Tax
Net Income
$16,100.0

19. Jacy’s Income Statement
Get together
Jacy’s Income Statement

20. Join your group.
Complete the Activity: Get Together: Jacy’s Income Statement
Use the figures to determine Jacy’s projected net income or loss.

21. Wrap-up
The Bottom Line

22. Statements of company’s value
Income Statement
Balance Sheet
Time Frame:
Content:
Purpose:
Time Frame:
Content:
Purpose: