Costs & Expenses Made Simple

Every kid thinks lemonade stands = free money. Until they realize they need to buy lemons.

1. Make a Lemonade Stand Budget

Write out: lemons = $2, sugar = $1, cups = $1. That’s $4 in expenses before any money comes in.

2. Walk the Grocery Store Aisle

Point out that every item—milk, bread, cereal—has a “behind the scenes” expense: farmers, packaging, transport.

3. Use School Supplies

Have them imagine running a classroom shop. Pencils cost 25¢, erasers 10¢. Show them how expenses eat into what they earn.

4. Compare Needs vs. Extras

Expenses aren’t just products—they can be advertising, rent, even Wi-Fi. Challenge kids to brainstorm which expenses are “must-haves” and which are “nice-to-haves.”

5. Expense Game

Hand your child $5 in play money. Give them an “expense list” (cups, lemons, sign). Watch them try to stretch it to cover everything.

Why It Matters: Understanding costs makes profit real. Without expenses, the business story is incomplete.