Financial Statements, ROI and Break-even (Business Concept 11)

Financial literacy is a subset of entrepreneurship education.

We talk on 'entrepreneurship education' on a later date.

Financial literacy is NOT accounting or economics

Its the very basic knowledge every entrepreneur should have about owning a business

Can a lawyer not like reading?

If your view entrepreneurship as a career path like any other (okay, maybe different from other careers); then financial literacy is the very basic of knowledge you MUST have

It’s important to understand that giving time, energy, and money to your business is an investment that will help you to meet your goals.

Entrepreneurship has the added requirement of self discipline and focus

Utilizing the tools of compound interest and the time value of money are indispensable to create wealth.

Compound interest is level 5 mathematics...

It is imperative that every young person learn basic record keeping, and how to read income statements, balance sheets, and cash flow statements

As scary as they might sound to you, you should open your mind and learn

For those of you in the Financial Fitness Boot camp, I broke it down to the barest level in your Week 11 e-book on your training school dashboard

I tried to write it like I was speaking to a 10 year old

Key Takeaway

As scary as they might sound to you, you should open your mind and learn

I used to hate those things..HATE I said

When I found I could not run a successful business without it, I had to seek knowledge

Return on investment (ROI) is calculated by dividing the profit from a venture by the amount of the investment.

It only makes sense for you to work this out before taking a decision on what you want to do with the limited funds at your disposal

What the ROI will be, should guide you on your investments.

And “breakeven” is important because it tells you whether or not you can afford your marketing plan.

Wikipedia defines break even point as 'representing the sales amount—in either unit (quantity) or revenue (sales) terms—that is required to cover total costs, consisting of both fixed and variable costs to the company. Total profit at the break-even point is zero.'

Understanding how to save and invest your money is vital to create and sustain wealth.

Scratch that, it is the ONLY true element necessary to sustainable wealth.

Okay, that's enough accounting jargon for today

On Monday we talk on Ownership

Till then, have a great weekend!

'Mobolanle


"When you say ROI, do you mean return on investment or risk of inaction."

Paul Gillin

 Veteran technology journalist

You know someone that might learn from this? Click here to spread the love!

Reference:

2018, May 20. Richard Branson. Retrieved from http://www.forbes.com

By | 2018-06-11T12:16:32+01:00 May 25th, 2018|Blog, Grow your business, Start your business, startup, Uncategorized|Comments Off on Financial Statements, ROI and Break-even (Business Concept 11)