Reply #11: Many businesses assume that they'll operate at a loss for a while. [View All]

[Igel]

The business plan for the one I worked for outlined the steps the owner anticipated would lead to profitability--sales goals for each year, anticipated outlays, the point at which it would have to move from her home to an independent location, etc., etc.

IIRC, she used the accrual method of accounting--she didn't see a point in depreciating over a decade if she thought the business might fail after 4 years. Not the world according to GAPP, I don't think, in how she dealt with how assets or return on investment.