Equipment List 

This is a list of each item of business equipment and its value. Generally equipment on this list is any major item used to provide a service or sell, store, deliver, or manufacture a product. The items should have a useful life of one year or longer. The lender may want a lien against this equipment as collateral or may want the business to insure this equipment and name the lender as the insured. When considering equipment needs, you and the consumer should consider whether or not to purchase or lease equipment. The advantage of leasing is low initial capital outlay. The disadvantage is that at the end of the lease the consumer does not own the equipment and may pay a large sum to purchase it.

Chapter 6 Business Plan Study Guide: Equipment List

1. Developing financial statements is one of the most difficult tasks that a new business owner will undertake. Why?
   
   
2. Financial statements are developed for the business's first ________ year(s).
   
   
3. For the first year (quarterly/monthly) financial projections are made.
   
   
4. Financial projections are made (semi-annually/quarterly) for subsequent years.
   
   
5. A major item with an expected list of at least one year, that is used to provide a service or sell, store, deliver, or manuafacture a product, should be listed on the Equipment List. T_____ F____
   
   
6. The following statements should be included as part of the financial plan.

Study Guide Answers: Chapter 6: The Equipment List

© July 1998, 1st Revision June 1999, 2nd Revision February 2001