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Financial Education


  • Submitted on 15 September 2011

    One hundred nonprofit organizations from 44 states and the District of Columbia received grants under the Program for Investment in Microentrepreneurs Act (PRIME), the U. S. Small Business Administration announced today. 

    Grants will be used to provide business-based training and technical assistance to low-income and very low-income entrepreneurs to help them start, operate, or grow a small business.  Grants will also be used to better equip community-based nonprofit organizations to provide training. 

  • Submitted on 08 August 2011

    Startups, newly established and growing small businesses now have a new source of financing backed by the U.S. Small Business Administration as 20 community organizations have been funded by SBA to start making loans up to $200,000 to qualifying small businesses.

    Authorized under the Small Business Jobs Act of 2010, the new Intermediary Lending Pilot Program will provide direct loans up to $1 million to 20 community organizations or intermediaries in fiscal year 2011, which in turn will use those funds to help finance small businesses, mostly in underserved markets.

  • Submitted on 02 May 2011

    The U.S. Small Business Administration has approved an initial group of six community-based, mission-focused lenders to start accepting and processing Community Advantage loan applications from small business borrowers immediately, the agency announced today.

  • Submitted on 11 April 2011

    Beyond Bankruptcy ReportSmall businesses that have previously filed for bankruptcy are no more burdened than other small firms by poor cash flow, high health insurance costs, or excessive taxes, and they attain similar firm sizes, according to a study released today by the U.S. Small Business Administration’s Office of Advocacy. However, they have about a 24 percent higher likelihood of being denied a loan and are charged interest rates at least 1 percent higher than other firms. The report finds that firms owned by African and Latino Americans are even more likely to be denied loans and charged higher interest rates.
     
    “Small businesses filing for bankruptcy have an opportunity for a new start. This new start is hampered by the challenges of obtaining new loans. This can impede innovation and job creation,” said Chief Counsel for Advocacy Winslow Sargeant.
     

  • Submitted on 18 March 2011

    MBDA offers a list of resources to assist minority businesses during tax season.

    Extension of Time To File Your Tax Return
    Need more time to prepare your federal income tax return? This page will direct you to information on how to apply for an extension. Learn More

    1040 Tax HelpFiling Late and/or Paying Late
    Avoid penalties and interest, paying your taxes in full saves you money. Whether paying with a timely filed tax return or filing late and paying late after receiving a correct IRS bill, taxpayers are encouraged to pay the taxes they owe in full. Lean More

    Electronic Payment Options
    Electronic payment options are convenient, safe, and secure methods for paying taxes or user fees. Taxpayers can authorize an electronic funds withdrawal, use a credit or debit card or enroll in the U.S. Treasury’s Electronic Federal Tax Payment System (EFTPS)®. Electronic payment options give taxpayers an alternative to paying taxes or user fees by check or money order. Payments can be made 24/7. The electronic funds withdrawal and EFTPS options are free! Learn More

     

    Tax Information for Specific Business Types
    Have you considered that your business might have specific taxes for its industry? Some industries, in fact do. The U.S. Internal Revenue Service (IRS) has published guides for businesses that have special tax considerations. Learn More

  • Submitted on 03 March 2011

    On Tuesday, March 29, 2011, the Internal Revenue Service is presenting a FREE webinar for tax professionals, small businesses, self-employed persons and independent contractors: Business Taxes for the Self-Employed: The Basics.

    The webinar will cover:

    • Reporting profit or loss from a business or profession

    • Self-employment tax and estimated tax payments

    • Schedule C and C-EZ

    • Deducting business expenses

    • Husband and wife businesses

    • Recordkeeping

    The webinar starts at 2 p.m. Eastern, 1 p.m. Central, noon Mountain and 11 a.m. Pacific.

  • Submitted on 06 August 2010

    Current Ratios and Quick Ratios

    Current ratios help evaluate a company’s ability to pay short-term obligations.

    Current ratio = current assets / current liabilities

    The current ratio includes all current assets, but since inventory is not always quickly liquidated, many analysts remove it from the equation and use the Quick ratio.

    Quick ratio = (current assets – inventory) / current liabilities

    The quick ratio emphasizes assets that are easily converted to cash.  The higher the ratio, the better off the company.  Analysts like to see ratios greater than 2:1 for current ratios and 1:1 for quick ratios.

  • Submitted on 06 August 2010

    Business FinancialsThere are three basic reports important to your business.

    • Income or Profit and Loss Statement
    • Cash Flow Statement
    • Balance Sheet

    An income or Profit and Loss Statement shows where and how money goes in and out of a company for a period of time.  Monthly, quarterly and annual Profit and Loss Statements show the financial strength of a company.

    The Cash Flow Statement is one of the most useful financial management tools because it shows you exactly how cash is flowing in and out of a business. 

    The Cash Flow Statement is a guide for business making business decisions such as adding employees or planning major purchases.

  • Submitted on 06 August 2010

    Key to CreditRegardless of where you seek funding - from a bank, a local development corporation or a relative - a prospective lender will review your creditworthiness. A complete and thoroughly documented loan request (including a business plan) will help the lender understand you and your business. The "Five C's" are the basic components of credit analysis. They are described here to help you understand what the lender looks for.

    The 5C's

    Capacity to repay is the most critical of the five factors, it is the primary source of repayment - cash. The prospective lender will want to know exactly how you intend to repay the loan. The lender will consider the cash flow from the business, the timing of the repayment, and the probability of successful repayment of the loan. Payment history on existing credit relationships - personal or commercial- is considered an indicator of future payment performance. Potential lenders also will want to know about other possible sources of repayment.

  • Submitted on 06 August 2010

    Credit ScoresFair Isaac & Co, or FICO, is a generic term for a credit bureau score and refers specifically to model used by FICO.  There are other statistical models, however, FICO is the most widely known.

    Credit scoring has become widely accepted by lenders as a reliable means of credit evaluation.  The credit score condenses borrowers credit history into a single number.  FICO and the credit bureaus don’t reveal the exact methodology for computing the numbers. 

    FICO scores vary from 375-900 points.  The higher, the better.  To get the best interest rates, you generally need to score 680 or higher.  Someone with higher than 680 is considered to have “A” credit.  If you score below 620, you will generally pay a higher interest rate on your mortgage and your credit is considered “sub-prime.” If your score is between 620 and 680, the lender may decide which category you belong based on factors such as income, assets, payment history, etc. 

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MBDA Minority Business Centers helped clients obtain capital totaling $4.76 billion during the last 5 fiscal years.
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