Lesson Plan

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Lesson Plan
Grade: Date: 17/01/2026
Subject: Business Studies
Lesson Topic: limitations of using accounts and ratio analysis
Learning Objective/s:
  • Describe the main users of financial accounts and their information needs.
  • Explain the key limitations of financial accounts and of ratio analysis.
  • Analyse how these limitations affect the interpretation of financial data.
  • Evaluate the importance of combining quantitative ratios with qualitative information in business decisions.
Materials Needed:
  • Whiteboard and markers
  • Projector with slide deck
  • Printed handouts of account extracts and ratio tables
  • Calculators (one per student)
  • Sticky notes for quick responses
  • Laptop for teacher demonstration
 Introduction:
Begin with a rapid‑fire quiz on who uses business accounts and why, linking to prior lessons on users of information. Highlight that today’s focus will be on the *limitations* of those accounts and the ratios derived from them. State that by the end of the lesson students will be able to identify and evaluate these limitations when making decisions.
Lesson Structure:
  1. Do‑now (5'): Quick quiz on users of accounts; teacher checks answers.
  2. Mini‑lecture (10'): Purpose of preparing accounts and overview of key users.
  3. Group activity (10'): Analyse a short case study to list limitations of accounts; report on sticky notes.
  4. Demonstration (8'): Calculate selected ratios (Gross Profit Margin, Current Ratio, ROCE) using the handout data; discuss inherent limitations.
  5. Discussion (8'): Groups compare ratio results, consider qualitative factors (brand, market trends) and propose how to mitigate limitations.
  6. Check for understanding (4'): Exit ticket – each student writes two limitations and one strategy to address each.
Conclusion:
Recap the main limitations of both accounts and ratio analysis and emphasise the need for qualitative judgement. Collect exit tickets to gauge understanding and assign homework: students must find a recent news article about a company and write a brief paragraph identifying how account or ratio limitations could affect the interpretation of that article’s financial claims.