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BUS 5601 Essentials of Business Development 1

Course Description

Examines necessary tools required to plan and run a successful business venture. Requires integration of concepts, methods and models from accounting, economics and marketing in forming a business plan for a product or service in a case study. First course in a two-course sequence.

Course Objectives

The objective of this course is to help business students learn fundamental business concepts and apply them by developing a business plan. This 8 week course is the first in a series of two courses. Students will learn the basics of accounting, economics and marketing while conducting a financial analysis of a company. A full business plan will be developed at the end of the second course in the series (BUS 5602).

Week 1

Lecture: Course Introduction


  • Define accounting
  • Identify users of accounting information and explain why it is useful
  • Discuss accounting services
  • Define financial accounting standards
  • Describe information reported in financial statements
  • Define the relationship between financial statements
  • Demonstrate the meaning and usefulness of the Accounting Equation
  • Identify limitations of financial statements

Week 2

Lecture: Transaction Analysis and the Balance Sheet


  • Calculate and interpret financial ratios
  • Analyze a financial transaction
  • Describe the relationship between the income statement and balance sheet through owner’s equity
  • Define revenue and understand revenue recognition criteria
  • Describe the purpose and general format of the income statement
  • Describe the general format of the statement of cash flows

Week 3

Lecture: Economics Introduction


  • Distinguish microeconomics from macroeconomics
  • Explain the concept of opportunity cost and how it relates to economic profit
  • List the four market structures and their main characteristics
  • List the determinants of demand and supply
  • Explain and illustrate in a demand/supply graph the terms market equilibrium, shortage and surplus
  • Use demand/supply graphs to determine the market’s equilibrium price and quantity
  • Describe the market outcomes associated with controlled prices
  • Determine short-term movements in the exchange rate using demand and supply analysis
  • Explain PPP theory; how it relates to the law of one price; and, how it is used to explain long term trend movements in the exchange rate

Week 4

Lecture: Cost Benefit Analysis


  • Explain the Cost-Benefit Principle and the three features of an optimization problem
  • Identify and describe the three irrelevant costs when applying the cost-benefit principle
  • Construct and work with MB-MC diagrams
  • Solve for the optimal solution using the cost-benefit principle
  • Describe the three most common measures of economic performance and how each varies over the phases of a business cycle
  • Explain how a central bank controls the money supply in an economy and how monetary policy is used to stabilize the economy
  • Describe the role of international reserves in pegging the exchange rate to a specific value
  • Describe how monetary policy is used to peg the exchange rate
  • Explain how a speculative attack against an overvalued currency ultimately leads to devaluation of the currency

Week 5

Lecture: Marketing Introduction


  • Define marketing
  • Explain why marketing is useful
  • Understand the marketing concept
  • Describe the major marketing functions
  • Explain the importance of marketing strategy
  • Understand marketing mix and explain the 4 P’s
  • Define target marketing
  • Explain market segmentation
  • Describe differentiation and product positioning

Week 6

Lecture: Marketing Environment


  • Understand the External Market Environment
  • Explain how changes in the External Environment can affect marketing strategy
  • Describe consumer behavior
  • Understand the factors which influence the buying decision
  • Explain the process used by consumers to make a buying decision

Week 7

Lecture: Corporate Governance and Financial Disclosures


  • Explain the importance of notes to the financial statements
  • Describe how significant accounting policies can affect financial disclosures
  • Describe the role of the Securities and Exchange Commission (SEC)
  • Explain the importance of corporate governance
  • Discuss the major financial ratios

Week 8

Lecture: Financial Statement Analysis Project


  • Complete a financial analysis of your selected company
  • Develop conclusions based on your analysis

The course description, objectives and learning outcomes are subject to change without notice based on enhancements made to the course. May 2011