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E-learning rewrite sample
The client wanted me to make the following content easier to read without changing it substantially. The text appears at the beginning of a module in a finance course. The content from the subject matter expert is on the left; my rewrite is on the right. I added a transition to the beginning to remind the learner what happened in the previous module, reorganized the information to match the organization of the module, and tightened the text overall.
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After determining that he had a negative cash flow during his first month of business, Jerry sits down with Sallie and they review her old college accounting textbook. They discover that keeping track of cash inflows and outflows is only the first step in charting the financial performance of a business.
Jerry and Sallie see that the big problem with just determining the cash flow is that it does not consider the potential useful life of a purchase. This is an important consideration because many of the items Jerry purchased during his first month of business would last a long time (e.g., equipment and furniture); other items had already been used up in the first month (e.g., sugar and lemons).
Jerry and Sallie also learn that, like most businesses, they need to recognize revenues when they are earned and recognize expenses when they are incurred, instead of tracking cash as it is collected and paid. Furthermore, they need to report earnings and expenses in standard formats that will enable them to better track the performance of Jerry's Lemonade.
Based on what they determine from the old accounting textbook, Jerry and Sallie are able to transform the cash flow statement they had prepared into an income statement and balance sheet for the first month of operation.
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When he and Sallie prepared a cash flow statement, Jerry discovered he had a negative cash flow for his first month of business. Now he wants to learn how to avoid more bad news.
He and Sallie review her old college accounting textbook. They discover that keeping track of cash flows isn't enough. Jerry needs to make two changes.
First, he should change how he records cash transactions. He's been tracking cash as it's collected and paid. Instead, he should record revenues when they're earned and expenses when they're incurred. He should use standard formats so revenues and expenses are easy to compare.
Second, focusing just on cash flow ignores the useful life of a purchase. Many of the items Jerry bought during his first month will last a long time, such as furniture. Other items were used up, such as sugar. Jerry's financial reports need to show the difference between these two groups.
To fix these problems, Jerry and Sallie turn their cash flow statement into an income statement and balance sheet.
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