Lesson Plan
Startup Finance Roadmap
Students will learn to calculate startup costs, determine profits, and analyze break-even points through hands-on activities, enabling informed financial decisions for a mock business.
Building foundational financial literacy and entrepreneurial skills prepares students for real-world money management and critical thinking in business contexts.
Audience
8th Grade Students
Time
55 minutes
Approach
Hands-on activities and interactive games
Materials
Money Matters Deck (Slide Deck), - Cost vs. Profit Calculator (Worksheet), - Break-Even Bingo (Game), - Calculator Solutions (Answer Key), - Whiteboard and Markers, and - Individual Calculators
Prep
Teacher Preparation
10 minutes
- Review the Money Matters Deck.
- Print sufficient copies of the Cost vs. Profit Calculator and Calculator Solutions.
- Ensure game materials for Break-Even Bingo are ready for group play.
- Arrange classroom for small-group activities and set up the whiteboard.
Step 1
Introduction
5 minutes
- Welcome students and introduce the session goals.
- Display agenda and key terms on the Money Matters Deck.
- Briefly discuss why financial literacy matters in entrepreneurship.
Step 2
Exploring Startup Costs
10 minutes
- Define ‘startup costs’ using slides 3–5 of the Money Matters Deck.
- In pairs, students list potential costs for a simple mock business (e.g., lemonade stand).
- Capture examples on the whiteboard and discuss fixed vs. variable costs.
Step 3
Profit Calculation Practice
10 minutes
- Introduce profit formula (Revenue − Costs) via slide 8.
- Distribute the Cost vs. Profit Calculator.
- Model one example calculation together, then have students complete two problems individually.
- Review answers using the Calculator Solutions.
Step 4
Break-Even Analysis Game
15 minutes
- Explain break-even point concept with slide 12 of the Money Matters Deck.
- Divide students into small groups and give each a Break-Even Bingo card.
- Call out cost/revenue scenarios; students mark spots when they calculate the break-even point correctly.
- First group to bingo explains one scenario to the class.
Step 5
Wrap-Up and Exit Ticket
15 minutes
- Review key terms: startup costs, profit, break-even.
- On the whiteboard, solve one final scenario as a class.
- Distribute a quick exit ticket: students define break-even and calculate profit for a new scenario.
- Collect exit tickets to assess individual understanding.
Slide Deck
Money Matters
Startup Costs · Profit Calculation · Break-Even Analysis
Welcome students to today’s session on financial literacy in entrepreneurship. Introduce yourself and explain that they’ll learn about startup costs, profit calculation, and break-even analysis. Encourage participation and questions.
Agenda
• Introduction (5 min)
• Exploring Startup Costs (10 min)
• Profit Calculation Practice (10 min)
• Break-Even Analysis Game (15 min)
• Wrap-Up & Exit Ticket (15 min)
Walk through each agenda item so students know the flow of the 55-minute session. Emphasize the interactive elements: pair activity and game.
Key Terms
• Startup Costs
• Fixed Costs
• Variable Costs
• Revenue
• Profit
• Break-Even Point
Define each term briefly and tell students you’ll refer back to these throughout the lesson. Ask if anyone has heard these before.
What Are Startup Costs?
Startup costs are the initial expenses to launch a business. Examples:
• Equipment (tables, pitchers)
• Materials (lemons, sugar)
• Permits or licenses
• Marketing materials
Explain that startup costs are the expenses needed to start a business before any sales occur. Provide relatable examples like buying lemonade stand supplies.
Fixed vs. Variable Costs
Fixed Costs: Remain constant (e.g., renting a stand space).
Variable Costs: Change with output (e.g., cost of lemons per pitcher).
Clarify the difference by underlining that fixed costs stay the same regardless of how much you produce, while variable costs change with production volume.
Pair Activity: Identify Costs
In pairs, list startup costs for a lemonade stand. Categorize each as fixed or variable. Be ready to share one example with the class.
Instructions for the pair activity: students work in pairs, list at least three fixed and three variable costs for a lemonade stand. Circulate and prompt groups.
Profit Formula
Profit = Revenue − Total Costs
Introduce the profit formula clearly. Write it on the board too. Explain revenue vs. costs distinction.
Example: Profit Calculation
Revenue: $50
Costs: $30
Profit = $50 − $30 = $20
Model the calculation step by step: subtract costs from revenue. Emphasize units (dollars) and sign of profit.
Your Turn: Profit Practice
- Revenue: $80, Costs: $45 → Profit?
- Revenue: $120, Costs: $75 → Profit?
Use the Cost vs. Profit Calculator.
Distribute the Cost vs. Profit Calculator. Give students 5 minutes to work individually on these two problems.
Break-Even Point
The break-even point is where total revenue equals total costs. At this point, profit is zero.
Summarize that the break-even point is where they make no profit or loss. Use simple language to cement understanding.
Break-Even Example
Cost = $100 + $5×units
Revenue = $15×units
Find u:
$15u = $100 + $5u → 10u = 100 → u = 10 units
Walk through the algebraic example on the board. Highlight how to set revenue equal to cost and solve for units.
Break-Even Bingo Game
Form small groups and get a Break-Even Bingo card.
When you calculate the correct break-even point, mark that spot.
First group to bingo explains one scenario.
Explain game rules: each group gets a bingo card, you’ll call scenarios, they calculate break-even, mark if they have it. First to bingo explains one calculation.
Graphical View of Break-Even
• X-axis: Units Sold • Y-axis: Dollars
• Cost line: starts at fixed cost, slope = variable cost per unit
• Revenue line: starts at 0, slope = price per unit
Intersection = break-even point
Draw a simple graph: cost line starting at fixed cost intercept, revenue line from origin. Point of intersection is break-even.
Review of Key Concepts
• Startup Costs • Fixed vs. Variable Costs
• Profit Calculation • Break-Even Analysis
Quickly recap all key concepts. Invite any final questions before the exit ticket.
Exit Ticket
- Define break-even point.
- If revenue = $90 and costs = $70, what is the profit?
Hand out exit tickets. Collect as students leave to check individual understanding.
Worksheet
Cost vs. Profit Calculator
Instructions: Use the formula Profit = Revenue − Total Costs to solve the following problems. Show all your work in the spaces provided.
1. Bake Sale Profit Calculation
You’re hosting a bake sale. Below are your costs and revenue:
| Item | Cost ($) |
|---|---|
| Ingredients (flour, sugar, etc.) | 40 |
| Table Rental | 25 |
| Marketing Posters | 15 |
Total Revenue Received: $120
a. Calculate your Total Costs: ____________
b. Calculate your Profit: ____________
2. Juice Stand Scenario
You’re running a juice stand. Your fixed cost is $30 and your variable cost per cup is $2. You sell each cup for $5. You sell 25 cups.
a. Write the formula for Total Cost:
__________ + ( __________ × __________ ) = __________
b. Calculate Total Cost for 25 cups: __________
c. Calculate Total Revenue (25 cups at $5 each): __________
d. Calculate Profit: __________
3. Design Your Own Scenario
Create your own mini-business project:
- Name your business: ____________
- List two Fixed Costs and their dollar amounts:
a. ____________: $ ____
b. ____________: $ ____ - List two Variable Costs (cost per unit) and assign a dollar amount:
a. ____________ per unit: $ ____
b. ____________ per unit: $ ____ - Decide on a Price per unit: $ ____
- Choose a number of units to sell: ____ units
- Calculate Total Cost, Total Revenue, and Profit for your scenario. Show your work:
- Total Cost: ____________
- Total Revenue: ____________
- Profit: ____________
Refer back to the Money Matters Deck for formulas and examples.
Game
Break-Even Bingo
Objective: Reinforce students’ ability to calculate break-even points under time pressure, encouraging collaboration and quick critical thinking.
Materials:
- Printed bingo card (one per group) – see Sample Bingo Card below
- Markers, chips, or highlighters to cover spots
- Scenario call sheet (below)
- Whiteboard or document camera to display scenarios (optional)
Teacher Instructions
- Distribute one bingo card and markers to each group of 3–4 students.
- Explain rules (see Student Instructions).
- Read aloud break-even scenarios in any order, giving students 30–45 seconds per scenario to calculate.
- When a group covers five numbers in a row (horizontal, vertical, or diagonal), they shout “Bingo!”
- Pause the game, have the winning group explain one of their covered scenarios (show work: fixed cost ÷ (price − variable cost)).
- Continue rounds as time allows or until another bingo.
Student Instructions
- Listen as the teacher reads each scenario (fixed cost, variable cost per unit, selling price).
- Calculate the break-even point using:
Break-Even Units = Fixed Cost ÷ (Price − Variable Cost) - If your bingo card contains that number of units, cover the spot.
- Aim to cover five in a row—horizontal, vertical, or diagonal—to get bingo.
- Be prepared to explain one calculation to the class when you win.
Sample Bingo Card
Use this template or recreate your own with the numbers below.
| B | I | N | G | O |
|---|---|---|---|---|
| 5 | 10 | 8 | 14 | 9 |
| 12 | 7 | 16 | 11 | 15 |
| 6 | 13 | Free | 4 | 17 |
| 20 | 18 | 19 | 21 | 22 |
| 23 | 24 | 25 | 26 | 27 |
Free is a free spot—cover it automatically.
Scenario Call Sheet
Read scenarios by number or randomly. Each maps to the break-even units on the card.
- Fixed Cost: $15, Variable Cost: $1, Price: $4 → 15 ÷ (4−1) = 5
- Fixed Cost: $20, Variable Cost: $2, Price: $4 → 20 ÷ (4−2) = 10
- Fixed Cost: $16, Variable Cost: $2, Price: $4 → 16 ÷ (4−2) = 8
- Fixed Cost: $42, Variable Cost: $3, Price: $6 → 42 ÷ (6−3) = 14
- Fixed Cost: $27, Variable Cost: $3, Price: $6 → 27 ÷ (6−3) = 9
- Fixed Cost: $12, Variable Cost: $1, Price: $3 → 12 ÷ (3−1) = 6
- Fixed Cost: $21, Variable Cost: $3, Price: $6 → 21 ÷ (6−3) = 7
- Fixed Cost: $36, Variable Cost: $3, Price: $6 → 36 ÷ (6−3) = 12
- Fixed Cost: $33, Variable Cost: $3, Price: $6 → 33 ÷ (6−3) = 11
- Fixed Cost: $45, Variable Cost: $3, Price: $6 → 45 ÷ (6−3) = 15
- Fixed Cost: $32, Variable Cost: $2, Price: $4 → 32 ÷ (4−2) = 16
- Fixed Cost: $26, Variable Cost: $2, Price: $4 → 26 ÷ (4−2) = 13
- Fixed Cost: $20, Variable Cost: $1, Price: $5 → 20 ÷ (5−1) = 5
- Fixed Cost: $34, Variable Cost: $2, Price: $4 → 34 ÷ (4−2) = 17
- Fixed Cost: $40, Variable Cost: $2, Price: $4 → 40 ÷ (4−2) = 20
- Fixed Cost: $36, Variable Cost: $2, Price: $4 → 36 ÷ (4−2) = 18
- Fixed Cost: $38, Variable Cost: $2, Price: $4 → 38 ÷ (4−2) = 19
- Fixed Cost: $42, Variable Cost: $2, Price: $4 → 42 ÷ (4−2) = 21
- Fixed Cost: $44, Variable Cost: $2, Price: $4 → 44 ÷ (4−2) = 22
- Fixed Cost: $46, Variable Cost: $2, Price: $4 → 46 ÷ (4−2) = 23
- Fixed Cost: $48, Variable Cost: $2, Price: $4 → 48 ÷ (4−2) = 24
- Fixed Cost: $25, Variable Cost: $1, Price: $2 → 25 ÷ (2−1) = 25
- Fixed Cost: $26, Variable Cost: $1, Price: $2 → 26 ÷ (2−1) = 26
- Fixed Cost: $27, Variable Cost: $1, Price: $2 → 27 ÷ (2−1) = 27
(You may repeat or shuffle as needed; ensure each called scenario matches one card number.)
Extension: For advanced groups, ask them to graph cost and revenue lines for one scenario and identify the intersection point visually.
Answer Key
Calculator Solutions
1. Bake Sale Profit Calculation
Given:
- Ingredients: $40
- Table Rental: $25
- Marketing Posters: $15
- Total Revenue: $120
Step-by-Step Solution:
- Calculate Total Costs:
Add all costs: 40 + 25 + 15 = $80 - Calculate Profit:
Profit = Revenue − Total Costs = 120 − 80 = $40
Answer:
- Total Costs: $80
- Profit: $40
2. Juice Stand Scenario
Given:
- Fixed Cost = $30
- Variable Cost per cup = $2
- Selling Price per cup = $5
- Cups sold = 25
Step-by-Step Solution:
- Write the Total Cost formula:
Total Cost = Fixed Cost + (Variable Cost × Units Sold)
→ 30 + (2 × 25) = 30 + 50 - Calculate Total Cost:
30 + 50 = $80 - Calculate Total Revenue:
Revenue = Price × Units Sold = 5 × 25 = $125 - Calculate Profit:
Profit = Revenue − Total Cost = 125 − 80 = $45
Answer:
- Total Cost: $80
- Total Revenue: $125
- Profit: $45
3. Design Your Own Scenario – Grading Rubric
Because student responses will vary, use the following checklist to evaluate each part of their work:
- Fixed Costs
• Correctly listed two fixed costs with dollar amounts
• Sum of fixed costs is accurate - Variable Costs
• Correctly listed two variable costs per unit with dollar amounts - Price & Units
• Price per unit is clear
• Number of units to sell is specified - Calculations
• Total Variable Cost: (Variable Cost per unit × Units Sold) is computed correctly
• Total Cost: (Sum of Fixed Costs + Total Variable Cost) is computed correctly
• Total Revenue: (Price × Units Sold) is computed correctly
• Profit: (Total Revenue − Total Cost) is computed correctly - Work Shown
• All steps are clearly documented
• Formulas are used correctly (refer to Profit = Revenue − Costs)
Use this rubric to assign partial credit for each component and ensure consistency across student submissions.
Refer back to the Cost vs. Profit Calculator for problem statements and to the Money Matters Deck for formulas.