Creating an Agribusiness Plan and Financial Record Analysis
This scenario-based lesson, created by the STEM Transitions project team, is free and requires a one-time registration to access all site materials. The lesson provides a forum for groups of students to create a hypothetical agribusiness entity and the necessary documents for agribusinesses to attain funding. Most farmers and ranchers do not have all the funds they need up front to launch an agribusiness. Even established agribusinesses require loans to fund certain endeavors such as the purchase of new equipment and updating of facilities. For individuals interested in agribusiness to reach their goals, they must apply for funding from various sources. For loan approval, lending institutions require farmers to prepare financial documents to prove that their agribusiness is in good financial standing and is worth the risk. The lesson incorporates a real-life scenario to instruct students in developing a business plan and secure financing.
Students will be able to: (1) Create business-related financial documents; (2) Demonstrate the ability to work collaboratively to explore mathematics concepts; (3) Gather data and represent it accurately; (4) Analyze data algebraically; (5) Demonstrate and apply understanding of financial ratios; and (6) Draw conclusions from collected data. In addition, students will be able to demonstrate the following agriculture/agribusiness skills: (1) Develop and write a mission statement to guide business activities effectively; (2) Establish short- and long-term goals; (3) Work in teams to access a variety of expertise; (4) Make business presentations; (5) Evaluate credit uses and options; (6) Prepare and interpret financial statements (e.g., balance sheet, profit/loss statement, cash flow statement); (7) Determine the cost of doing business; and (8) Calculate the costs of carrying inventory.