Lab Description
Welcome to the "Cookies Inc. - Recipe Ratios" Business Lab! This lab is designed to provide high school students with hands-on experience in entrepreneurship, mathematics, and business management.
In this lab, students will embark on a journey to start their own cookie business using grandma's special recipe. However, there's a twist – they begin with limited funds and must navigate through mathematical calculations, budgeting, and decision-making to turn their business idea into a profitable venture.
The lab unfolds in several stages:
- Business Idea Exploration: Students explore the concept of starting a cookie business, initially outside a mall using a cookie cart.
- Mathematical Conversions: Students apply mathematical concepts such as ratios and proportions to convert kitchen units (like cups and tablespoons) into standard units (such as pounds and gallons) for ingredients.
- Cost Calculations: Using a supplier's rate card, students calculate the total cost of making one cookie and determine the cost for a batch of 25 cookies.
- Budgeting and Purchasing: With a $1500 investment from grandma, students budget and purchase ingredients for their initial batch of cookies while ensuring they stay within budget.
- Sales and Revenue: Students track their sales at $1.20 per cookie, using the revenue from the first month to reinvest in ingredients for subsequent batches.
- Profit Generation: The ultimate goal is for students to generate enough profit by the end of the third month to repay grandma's initial investment and have an additional $3000 in profit.
Through this immersive lab, students will develop critical skills in mathematics, financial literacy, problem-solving, and entrepreneurial thinking. It's a dynamic learning experience that bridges the gap between classroom learning and real-world application, preparing students for future success in business and beyond.
Who this course is for
Students in middle and high school can master Ratio & Fractions, and Business Basics using this Lab.
Student Feedbacks
We asked students, what you remember the most about the lab, and here are some of the responses
Introduction (40 Minutes)
Students will watch a video explaining the business problem to be solved. Here is the link to the video - link
Sub Activities
- Review Questions
Students will read a graphical material explaining key business terms - cost, revenue, profit, and investment.
Sub Activities
- Review Questions
Students will read and understand the concepts of demand and demand curve, as well as profit curve, and learn how to utilize the profit curve to determine the optimal price for a product.
Sub Activities
- Review Questions
- Television Demand
Students will demonstrate their understanding of key business concepts, such as pricing strategies and decision-making, by effectively communicating their business proposal and rationale to Grandma. They will articulate the best price discovered through analysis, explain the methodology used to determine it, and showcase the utilization of graphs in their decision-making process.
Students will read and understand the role math plays in business and also understand that they will use basic math in this lab to run their business.
Sub Activities
- Ingredients Ratio
The learning objective for the optional writing activity is for students to research and analyze a recipe for one of their favorite foods to understand the proportion of ingredients in a ratio format. By engaging in this activity, students will reinforce their understanding of ratios and proportions in a real-world context, applying mathematical concepts to everyday scenarios. Additionally, this activity encourages independent research skills and critical thinking as students explore and interpret recipe proportions.
Additionally, for fast-finishing students, the teacher can suggest this optional activity to further deepen their understanding of ratios and provide an opportunity for independent exploration and application of learned concepts.
Business Planning (18 Minutes)
Students will read and understand that they have to convert the ingredients from kitchen units (cups and tablespoons) to standard units (pounds and gallons) before preparing the purchase order.
Students will use basic math to convert the units using the given conversion table -
Students will read and understand that the ingredients given are for preparing 25 cookies, but to start the business, it is important to know the cost of one cookie. They will use the rate card provided by the supplier to calculate the total cost of a cookie.
Students will utilize the rate card provided and the quantities of ingredients calculated in the previous step to determine the total cost of producing a single cookie.
Month 1 of Business (28 Minutes)
The first step in the Month 1 activities is to plan the number of cookies to be produced. Students will do simple calculations to decide the number of cookies to produce for Month 1.
Here is a sample filled worksheet -
Students will read and understand how to place the purchase order, they will understand that they are buying ingredients from a wholesale supplier and their task is to find the number of bags of each ingredients to buy.
Students will utilize a purchase order form to determine the number of bags of each ingredient to be purchased. The challenge lies in the fact that students must order bags of each ingredient, not exact quantities, potentially leading to overbuying or underbuying to match the available budget.
A sample purchase order form -
This activity is to review the purchase order.
An example order form to review -
Now that students decided on the number of cookies to produce and prepared the ingredient order form, the next task is to set the price for a cookie. The sales will automatically happen with this price. In this activity, students will read the importance of pricing the cookies.
Students will utilize the interactive demand-profit curve and slider to determine the price that yields maximum profit. This crucial step involves identifying the price of their cookie, which will be integral to the subsequent activities in the lab. The objective of this activity is to make students understand the importance of pricing and its role in the profit generated.
Month 2 of Business (32 Minutes)
Students will analyze their sales results for Month 1, taking into account the shortage of some ingredients due to budget constraints resulting in fewer cookies produced than planned. They will also evaluate the leftover ingredients to be used in the following month. This analysis will inform their decisions before starting the next month, helping them understand the available budget for the next month's purchase.
Here is a sample result sheet -
Students will use the revenue generated from Month 1 to plan the cookies for Month 2, a sample sheet looks like this -
Students will prepare a new purchase order for the second month, the quantities to be purchased will be different from the first month as they will be producing more cookies using the profit they gained form Month 1. Here is a sample form -
Students will review the purchase order for Month 2.
An example order form to review -
Students will read about a new challenge they are going to face - weather. The weather will be rainy in Month 2, which will cause fewer customers to come to the cart. The new demand curve will account for this.
Students will use a different demand curve to find the best price for their cookies for Month 2.
A sample worksheet looks like this -
Month 3 of Business (37 Minutes)
Students will analyze their sales results for Month 2, also, the revenue, and profit change compared to last month. They will also evaluate the leftover ingredients to be used in the following month.
A sample result sheet looks like this -
As a surprise element, students are tasked with paying back the investment received from Grandma before they commence Month 3 of business. This repayment will significantly reduce the remaining balance available for purchasing in Month 3. However, if they successfully managed the first two months, they should have a sufficient balance to overcome this challenge and succeed in the overall business simulation.
Sub Activities
- Paying Back Grandma
Students will use the revenue generated from Month 1 to plan the cookies for Month 2, a sample sheet looks like this -
Students will place their purchase order for Month 3, they should be careful not to over-purchase any ingredient as this is the last month of their purchase. Here is a worksheet filled with sample data -
Students will review the purchase order for Month 3. Here is a worksheet filled with sample data -
Students will read and understand that the weather is back to normal and that will increase demand for their cookies. Now, they need to set a new price for their cookies.
Students will use the slider and graph to find a new price for their cookies that will help them to sell the maximum number of cookies and to increase their profit. The demand this time is back to normal compared to Month 2.
A pricing worksheet filled with sample values looks like this -
Final Sales Report & Conclusion (27 Minutes)
Students will be presented with their final results, final money balance after three months of business, etc. Students can analyze the data and wait for the teacher to present the final leaderboard that shows who made a maximum profit at the end of the third month. If they did the activities correct, they should easily be able to make a profit of $3000. Here is a worksheet showing the final balance -
Students will analyze their income statement for the three months and understand how their cookies cart grew in terms of profit. The activity aims to provide them an idea of accounting and related terms.
The learning objective of this activity is for students to synthesize their understanding of business success factors, and skills by composing a persuasive letter to the mall manager. Through this activity, students will demonstrate their ability to articulate the strategies and decisions that led to profitability in their cookie store business over three months, including pricing strategies, budgeting for purchases and reinvesting the money in business. This objective aims to prepare students for real-world business scenarios by integrating business concepts with communication proficiency and teamwork abilities.
Students will demonstrate their understanding of marketing concepts by creating an advertisement poster for their cookie store. They will apply their knowledge of branding, unique selling propositions, visual design, and customer engagement to effectively promote their store's opening inside the mall. This activity aims to develop students' skills in marketing communication, creative expression, and strategic thinking in a business context.
Common Core: MATH
Write, read, and evaluate expressions in which letters stand for numbers.
Interpret and compute quotients of fractions, and solve word problems involving division of fractions by fractions, e.g., by using visual fraction models and equations to represent the problem. *For example, create a story context for (2/3) ÷ (3/4) and use a visual fraction model to show the quotient; use the relationship between multiplication and division to explain that (2/3) ÷ (3/4) = 8/9 because 3/4 of 8/9 is 2/3. (In general, (a/b) ÷ (c/d) = ad/bc.) How much chocolate will each person get if 3 people share 1/2 lb of chocolate equally? How many 3/4-cup servings are in 2/3 of a cup of yogurt? How wide is a rectangular strip of land with length 3/4 mi and area 1/2 square mi?*.
Understand the concept of a ratio and use ratio language to describe a ratio relationship between two quantities. *For example, "The ratio of wings to beaks in the bird house at the zoo was 2:1, because for every 2 wings there was 1 beak." "For every vote candidate A received, candidate C received nearly three votes."*
Understand the concept of a unit rate a/b associated with a ratio a:b with b ≠ 0, and use rate language in the context of a ratio relationship. *For example, "This recipe has a ratio of 3 cups of flour to 4 cups of sugar, so there is 3/4 cup of flour for each cup of sugar." "We paid $75 for 15 hamburgers, which is a rate of $5 per hamburger."*
Use ratio and rate reasoning to solve real-world and mathematical problems, e.g., by reasoning about tables of equivalent ratios, tape diagrams, double number line diagrams, or equations.
Make tables of equivalent ratios relating quantities with whole-number measurements, find missing values in the tables, and plot the pairs of values on the coordinate plane. Use tables to compare ratios.
Solve unit rate problems including those involving unit pricing and constant speed. *For example, if it took 7 hours to mow 4 lawns, then at that rate, how many lawns could be mowed in 35 hours? At what rate were lawns being mowed?*
Compute unit rates associated with ratios of fractions, including ratios of lengths, areas and other quantities measured in like or different units. *For example, if a person walks 1/2 mile in each 1/4 hour, compute the unit rate as the complex fraction ^1/2/1/4 miles per hour, equivalently 2 miles per hour*.
Recognize and represent proportional relationships between quantities.