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Lesson plan · Entrepreneurship · Lesson 8

Basic Accounting for Founders

Tracking money in and out, and keeping business money separate.

  • 45 minutes
  • Grades 9–12
  • Beginner
  • Activity: pairs
Present slidesWorksheet + keyStudent lesson

Objectives

Students will be able to:

  • Record income and expenses in a simple ledger
  • Explain why business and personal money should be kept separate
  • Recognize when self-employment income may require filing a tax return

Materials

  • Slide deck and a projector
  • Worksheet (one per student)
  • Exit ticket slips (bottom of the worksheet)

45-minute agenda

  1. 0–5 min

    Warm-up

    Post: “If you sold $300 of things this month, how would you know how much you actually made?”

  2. 5–17 min

    Direct instruction

    Present the lesson slides. Make sure students leave with these points:

    • Track every dollar with a simple ledger.
    • Keep receipts.
    • Separate business and personal money.
    • Profit ≠ cash.
    • $400+ in net self-employment earnings generally means filing a tax return.

    Use the “See it” slide (Marcus's ledger summary for October) to make the idea visual.

  3. 17–22 min

    Worked example

    Walk through “Why Marcus's bank balance didn't match” on the slides. Pause before the result and ask students to predict it.

  4. 22–32 min

    Ledger Lab

    Format: pairs · 10 minutes

    1. A small business account has these transactions: sale +$40, sale +$60, supplies −$35, sale +$25, ads −$20, sale +$80, lunch for the owner −$12, supplies −$18.
    2. Pairs record each in a ledger with columns for date, description, money in, money out, and category.
    3. Pairs calculate the business's profit and the change in the bank balance.
    4. Pairs explain why the two numbers differ.

    What to look for: Sales $205, business expenses $73, profit $132. The bank balance changed by $120 because a $12 personal lunch came out of the business account — mixing money hides the real results.

  5. 32–37 min

    Check for understanding

    Use the question slides — or run them as a Four Corners game. Answers:

    1. Why keep business money separate from personal money? — A. It makes it clear what the business actually earns and spends.
    2. Under IRS rules, what's generally true? — B. Net self-employment earnings of $400 or more generally mean filing a return and paying self-employment tax.
    3. If your ledger shows a profit, your bank balance must have grown by that same amount. — False
  6. 37–42 min

    Discussion

    • What would you use to track a small business's money: an app, a spreadsheet, or paper? Why?
    • Why do so many small businesses get surprised by taxes?
  7. 42–45 min

    Exit ticket

    Prompt: Generally, what level of net self-employment earnings means you need to file a federal tax return?

    Answer: $400 or more (rules can change — check irs.gov).

Differentiation

Common misconception

“If money is in my account, it's profit.” Only after subtracting all expenses — and business and personal money should never mix.

Support

Provide a pre-drawn ledger with categories listed.

Extension

Set up a ledger for a real or imagined business and track one week of transactions.

Homework or make-up work

Students can complete the full interactive lesson — including its knowledge check — at learnwithflc.org/courses/entrepreneurship/basic-accounting. No account needed; progress saves on their device.