Reading Log Chapter 10

Reading Log Chapter 10 - 4 Accounts payable are like loans...

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Name: Andy Kalish BUS 100, Section: 010 Date: 03-25-08 Reading Log for Chapter: 10 Chapter Title: Accounting The five most important points of this reading were: 1. Accounting is made up of Assets, Liabilities, and Owner’s Equity. Assets are what you have, such as machinery, inventory, accounts receivable, and cash. Liabilities are what you owe such as accounts payable, and salaries payable. Owner’s equity is how much the owner is worth. This means if the company had to sell everything that is how much the owner would get back. 2. The balance sheet summarizes the assets, liabilities and owners’ equity for a company at a moment in time. 3. The income sheet provides information about the changes in owners’ equity over a period of time. The primary components of the income statement are revenues and expenses.
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Unformatted text preview: 4. Accounts payable are like loans you have with certain companies that sell you things such as equipment or inventory. If you buy a large amount, instead of paying it all at once, you pay over a period of time. 5. Assets = Liabilities + Owner’s Equity. When preparing a balance sheet you need to make sure the sum of all assets is equal to liabilities plus owner’s equity. How do the topics introduced in this chapter relate to your interests in business? Having an accountant is an important piece of a company because they organize all expenses, income, and keep track of all the money. Unless you are a very organized person, it is almost necessary to hire an accountant to make sure everything is in good standing and correct....
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