1. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 SECTION OPENER / CLOSER INSERT BOOK COVER ART Section 4.3 Getting Started in Your Own Business

2. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 WHAT YOU’LL LEARN How to identify the different forms of legal business ownership Key factors that impact the success of new businesses continued

3. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 WHAT YOU’LL LEARN How to prepare the documents necessary for financing a new business

4. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Thoughtful planning and preparation are essential in ensuring the success of a new business. WHY IT’S IMPORTANT

5. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 sole proprietorship partnershipcorporation operating expenses income statement KEY TERMS continued

6. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 revenue gross profit net profit KEY TERMS

7. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 The three forms of legal business ownership are: Forms of Legal Ownership continued sole proprietorship, partnership, and corporation.

8. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 A sole proprietorship is a business that is completely owned by one person. About 75 percent of all U.S. businesses are sole proprietorships. Sole Proprietorship

9. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 A partnership is a business arrangement in which two or more people share ownership. Control and profits are divided among partners according to a partnership agreement. PartnershipPartnership

10. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 A corporation is a business owned by people who buy shares in the company. Shareholders earn a profit based on the number of shares they own. CorporationCorporation

11. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 When the location of your business is important, consider these factors: Location, Location, Location types of businesses in the area, condition of streets and buildings, location of the competition, and location of your customers.

12. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Working in your home is cheaper and more convenient than leasing a location. You’ll also enjoy more flexibility and a relaxed atmosphere. Working at Home

13. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Some communities restrict the kinds of businesses that can operate in residential areas. Working at home can be isolating. Working at Home

14. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Whatever type of business you launch, you’ll need money to get it going. To apply for a loan, you’ll need a business plan and a financial plan. FinancingFinancing

15. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 The important points covered in a business plan are: FinancingFinancing product description, business location, number of employees and their salaries, continued

16. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 FinancingFinancing strengths and weaknesses of competitors, and timetable for starting the business.

17. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 A financial plan spells out your start-up costs, operating expenses, and other costs for the first few months. Operating expenses are the costs of doing business. FinancingFinancing

18. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Graphic Organizer 4.3 Chapter 4 EntrepreneurshipSucceeding in the World of Work Opening Your Own Business Choose a Form of Ownership Choose a Location Write a Business Plan Obtain Financing Open Your Business

19. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Whatever business you choose to start, you will need a variety of skills, including: Operating Your Own Business reading,writing, math, and listening and speaking skills.

20. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 An income statement is a summary of your business’s income and expenses during a specific period such as a month, a quarter, or a year. Operating Your Own Business

21. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Revenue is income from sales. Revenue is the first item on an income statement. Operating Your Own Business

22. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Gross profit is the difference between the cost of goods and their selling price. Net profit is the amount left over after operating expenses are subtracted from the gross profit. Operating Your Own Business

23. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 A balance sheet summarizes a business’s assets, liabilities, and the owner’s equity. Operating Your Own Business

24. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Assets, which can be classified as current or fixed, are anything of monetary value that the business owns. Operating Your Own Business

25. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Liabilities are debts a business owner owes. Operating Your Own Business

26. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Equity, or ownership interest, is the amount you have invested in your business. Operating Your Own Business

27. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 A cash flow statement is a monthly plan that shows when you anticipate that the business will receive cash and when you expect to pay out cash. Operating Your Own Business

28. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Key Concept Checkpoint Comprehension 1.Imagine that you are starting a trucking company. What form of ownership will you choose? Why? continued SECTION 4.3 REVIEW

29. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Key Concept Checkpoint Comprehension 2.What should you consider in choosing a location for this business? continued SECTION 4.3 REVIEW

30. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Key Concept Checkpoint Comprehension 3.You have decided to organize your trucking company as a corporation. How will you go about financing it? continued SECTION 4.3 REVIEW

31. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 Key Concept Checkpoint Critical Thinking 4.Why might you choose to take a business loan from a bank, even if a relative has enough money to finance your venture? SECTION 4.3 REVIEW

32. Chapter 4 EntrepreneurshipSucceeding in the World of Work Getting Started in Your Own Business 4.3 SECTION OPENER / CLOSER INSERT BOOK COVER ART End of Section 4.3 Getting Started in Your Own Business