Create a balance sheet and an income statement (profitand-loss statement) for your business.

Hint: You will have two options for creating these reports. The first option is to use the Microsoft Word versions that are found within the Business Plan Student Template itself. The second option is to use the specific Microsoft Excel templates created for each statement, which are found on the book’s companion website at www.pearsonhighered.com/ebert. These Excel files are handy to use because they already have the worksheet calculations preset—all you have to do is “plug in” the numbers and the calculations will be performed automatically for you. If you make adjustments to the different values in the Excel worksheets, you’ll automatically see how changes to expenses, for example, can improve the “bottom line.”

Note: Once you have answered the questions, save your Word document. You’ll be answering additional questions in later chapters.