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Questions and Answers
A business plan determines whether a business idea is viable, doable, and profitable.
A business plan determines whether a business idea is viable, doable, and profitable.
False (B)
A feasibility study plots the details on how, when, and why things are done.
A feasibility study plots the details on how, when, and why things are done.
False (B)
A business plan is used to determine the viability of a business idea.
A business plan is used to determine the viability of a business idea.
False (B)
A business plan gives a quick overview of the content of the whole business plan.
A business plan gives a quick overview of the content of the whole business plan.
A feasibility study is a detailed description of the business plan.
A feasibility study is a detailed description of the business plan.
A business plan is used to attain profits and objectives.
A business plan is used to attain profits and objectives.
An agricultural enterprise requires special considerations in a business plan.
An agricultural enterprise requires special considerations in a business plan.
A business plan can be used to identify common mistakes in drafting a business plan.
A business plan can be used to identify common mistakes in drafting a business plan.
A good marketing plan is based on the information from a market research.
A good marketing plan is based on the information from a market research.
SWOT analysis is used to determine the opportunities and threats in the internal environment.
SWOT analysis is used to determine the opportunities and threats in the internal environment.
Product description is a part of the market analysis.
Product description is a part of the market analysis.
Target market analysis describes the product features and benefits.
Target market analysis describes the product features and benefits.
Competition analysis describes the company's marketing strategies.
Competition analysis describes the company's marketing strategies.
Market analysis presents the result of SWOT analysis and statistical data.
Market analysis presents the result of SWOT analysis and statistical data.
A business plan includes a table on the names of the owners, their address, responsibilities, and experience.
A business plan includes a table on the names of the owners, their address, responsibilities, and experience.
The financial plan is structured to measure liquidity of the enterprise.
The financial plan is structured to measure liquidity of the enterprise.
Marketing includes sale and delivery of products to buyers.
Marketing includes sale and delivery of products to buyers.
Production involves only product manufacture.
Production involves only product manufacture.
Finance involves bookkeeping, payroll preparation, and settlement of payables and collection of receivables.
Finance involves bookkeeping, payroll preparation, and settlement of payables and collection of receivables.
Administration involves only business communication and inquiry.
Administration involves only business communication and inquiry.
The operational plan includes the financial plan and organizational plan.
The operational plan includes the financial plan and organizational plan.
The capital requirements of the enterprise are classified into five categories.
The capital requirements of the enterprise are classified into five categories.
A business plan includes a presentation of the business structure, such as a sole proprietorship.
A business plan includes a presentation of the business structure, such as a sole proprietorship.
The financial plan measures liquidity and profitability of the enterprise.
The financial plan measures liquidity and profitability of the enterprise.
Pre-operating capital is the amount spent after the business begins to operate.
Pre-operating capital is the amount spent after the business begins to operate.
Working capital is a one-time expense for business assets.
Working capital is a one-time expense for business assets.
Fixed capital includes expenses for supplies and materials.
Fixed capital includes expenses for supplies and materials.
Pre-operating expense is a major cost/expense category in a business plan.
Pre-operating expense is a major cost/expense category in a business plan.
Production expense is a type of indirect cost.
Production expense is a type of indirect cost.
Direct expense is an expense on rent and utilities.
Direct expense is an expense on rent and utilities.
Indirect cost includes expenses on raw materials and direct labor.
Indirect cost includes expenses on raw materials and direct labor.
Financial plan is a part of a business plan.
Financial plan is a part of a business plan.
A pre-operating expense includes expenses on registering the business.
A pre-operating expense includes expenses on registering the business.
A financial plan includes only the source of capital and depreciation of assets.
A financial plan includes only the source of capital and depreciation of assets.
Debt involves contributing capital in exchange for ownership of the enterprise.
Debt involves contributing capital in exchange for ownership of the enterprise.
Equity is a source of capital that involves borrowing resources with interest.
Equity is a source of capital that involves borrowing resources with interest.
A financial plan is a part of a business plan.
A financial plan is a part of a business plan.
Direct production costs include administrative costs.
Direct production costs include administrative costs.
A financial plan includes only fixed capital and depreciation.
A financial plan includes only fixed capital and depreciation.
Pre-operating expenses include expenses on initial promotional activities.
Pre-operating expenses include expenses on initial promotional activities.
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Study Notes
Business Plan vs Feasibility Study
- A feasibility study determines whether a business decision is viable, doable, and profitable
- A business plan plots the details on how, when, and why things are done to realize profits and attain objectives
Importance of Business Plan
- No specific importance mentioned in the text
Common Mistakes in Drafting Business Plan
- No specific mistakes mentioned in the text
Vital Information Needed in Considering an Agricultural Enterprise
- No specific information mentioned in the text
Parts of a Business Plan
Executive Summary
- A quick overview of the content of the whole business plan
- Gives the reader a brief picture of the enterprise and encourages them to read further
Marketing Plan
- Based on market research, including analysis of the industry and existing competitors
- Includes SWOT analysis to determine strengths, weaknesses, opportunities, and threats
- Includes product description, market analysis, target market, competition, and marketing strategies
Organizational Plan
- Describes the business structure (sole proprietorship, partnership, corporation, cooperative)
- Includes an organizational chart and tables on owners, their addresses, responsibilities, and experience
- Includes tables on support personnel, their qualifications, number of individuals needed, and corresponding salaries and wages
Operational/Organizational Plan
- Includes functional areas of management: marketing, production, finance, and administration
- Describes the basic functional areas of management, including marketing, production, finance, and administration
Financial Plan
- Structured to measure profitability and equity growth of the enterprise
- Classifies capital requirements into three: pre-operating capital, working/operating capital, and fixed capital
- Includes major cost/expense categories: pre-operating expenses, production expenses, and fixed capital
- Includes cost projection tables for pre-operating expenses, fixed capital, and depreciation
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