Professor Elam

Weekend Oct 22, 2017

ACCT 3301 is accounting for non accounting majors.  I have mentioned to the class that

• many entrepreneurs have no idea whether they are making money
• they lack the expertise to calculate break even or target profit
• They lack a budget
• There are no standard costs for targets

Here is the story of Felipe's.

Felipe's is a small Mexican Food restaurant in a strip mall in Palm Springs. It was begun by two Hispanic brothers in law whose only real experience was as waiters.  Does this sound familiar, gee how many of these do you suppose are in San Antonio?  There are so many the Express news is running a series called 365 DAys of Tacos, knowing they will never run out or restaurants to discuss.

This is precisely the kind of story I have been alluding to in class. You never know if you would want to start a business or you might HAVE to start a business. The article mentions the necessity of making money from the get go, no rich relatives to lean on. And on the second page,  the lack of administrative expertise was solved by hiring a local accounting firm. Great idea!

The article mentions paying required payroll and sales taxes which is certainly important. It does not mention having the CPAs help with break even calculations, to my thinking that would be crucial.

But as I say we try to make students aware of the necessity of doing this. Otherwise the firm is sailing the boat without a map!