Accounting - The Heart of Business 2019

The purpose of a business at least, any business without a non-profit designation is to earn a living for the business owner and make a profit for the owner and investors. The purpose of a language is to communicate. If a business owner is to communicate with all that have a stake or an interest in his business, he needs a language to explain his business. He needs to explain the performance of the business to stockholders and co-investors. He has to file tax returns that include forms describing in detail the activities of the business including cash flow, gross and net profits, deductible expenses and so forth. The only way to explain these things is with numbers, organized in a structure that all parties can understand. That structure, the sentences and paragraphs of the language of business is found in the rows and columns of accounting documents. .uc232a4d83d0467172526bc524efcfa3c { padding:0px; margin: 0; padding-top:1em!important; padding-bottom:1em!important; width:100%; display: block; font-weight:bold; background-color:#eaeaea; border:0!important; border-left:4px solid #34495E!important; box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -moz-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -o-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -webkit-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); text-decoration:none; } .uc232a4d83d0467172526bc524efcfa3c:active, .uc232a4d83d0467172526bc524efcfa3c:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; text-decoration:none; } .uc232a4d83d0467172526bc524efcfa3c { transition: background-color 250ms; webkit-transition: background-color 250ms; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; } .uc232a4d83d0467172526bc524efcfa3c .ctaText { font-weight:bold; color:inherit; text-decoration:none; font-size: 16px; } .uc232a4d83d0467172526bc524efcfa3c .post Title { color:#000000; text-decoration: underline!important; font-size: 16px; } .uc232a4d83d0467172526bc524efcfa3c:hover .postTitle { text-decoration: underline!important; } READ Small Business Accounting Software from MicrosoftThe basics of accounting follow the cycles of a business through the course of a fiscal year. The end of that year may or may not be defined by the date federal taxes are due. In any case, the accountant begins with a general ledger that records business transactions. Debits and credits are recorded in detail or within a system that connects them to a record on each item kept elsewhere. At some point the general ledger is reconciled and a financial report is prepared. The income statement reflects income and expenses, which define the companys performance. The balance sheet shows the companys position at any point in time by itemizing assets, liabilities and equity. A cash flow statement will take the income and expense figures over time and provide cash flow projections based on anticipated sales and disbursements. From this, some degree of management evaluation can be made and decisions made on company business strategy moving forward. .ub74e442c85e68178cb72a9aa21f7cf4b { padding:0px; margin: 0; padding-top:1em!important; padding-bottom:1em!important; width:100%; display: block; font-weight:bold; background-color:#eaeaea; border:0!important; border-left:4px solid #34495E!important; box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -moz-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -o-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -webkit-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); text-decoration:none; } .ub74e442c85e68178cb72a9aa21f7cf4b:active, .ub74e442c85e68178cb72a9aa21f7cf4b:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; text-decoration:none; } .ub74e442c85e68178cb72a9aa21f7cf4b { transition: background-color 250ms; webkit-transition: background-color 250ms; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; } .ub74e442c85e68178cb72a9aa21f7cf4b .ctaText { font-weight:bold; color:inherit; text-decoration:none; font-size: 16px; } .ub74e442c85e68178cb72a9aa21f7cf4b .post Title { color:#000000; text-decoration: underline!important; font-size: 16px; } .ub74e442c85e68178cb72a9aa21f7cf4b:hover .postTitle { text-decoration: underline!important; } READ A Day in the Life of an Online Masters Degree Student Accounting records business transactions and then manipulates the transaction records to develop tools of analysis. A businesss accounting also supports the annual tax filing that the business makes and the position taken on any number of business costs and expenses that are claimed as tax deductions. In a public company there are many arenas for debate. In upper management with board members and among stockholders, business strategy is very much an open question. The records provided in a public companys annual report and 10K filings provide the analytical tools to fuel discussion on business performance. Numbers take on strategic meaning and represent the wisdom and risk of various business decisions. A premier example of substantial business risk is an acquisition. Before one company buys another, the process of due diligence provides for minute inspection of the performance turned in by the property for sale. That is to be found in those columns of numbers generated by the accounting department. The standards of accounting are found in agreement on its terminology and the structure of its documents. The language itself is composed of the numbers that fill those documents, and the message is the story they tell about a businesss economic performance. .u5695f39bf7110d71488597a4909901c7 { padding:0px; margin: 0; padding-top:1em!important; padding-bottom:1em!important; width:100%; display: block; font-weight:bold; background-color:#eaeaea; border:0!important; border-left:4px solid #34495E!important; box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -moz-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -o-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); -webkit-box-shadow: 0 1px 2px rgba(0, 0, 0, 0.17); text-decoration:none; } .u5695f39bf7110d71488597a4909901c7:active, .u5695f39bf7110d71488597a4909901c7:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; text-decoration:none; } .u5695f39bf7110d71488597a4909901c7 { transition: background-color 250ms; webkit-transition: background-color 250ms; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; } .u5695f39bf7110d71488597a4909901c7 .ctaText { font-weight:bold; color:inherit; text-decoration:none; font-size: 16px; } .u5695f39bf7110d71488597a4909901c7 .post Title { color:#000000; text-decoration: underline!important; font-size: 16px; } .u5695f39bf7110d71488597a4909901c7:hover .postTitle { text-decoration: underline!important; } READ A Master's Degree in Business AdministrationRelated ArticlesGeneral Engineering Degree Make Use of Technical and People Skills as a Sales EngineerSalaries in the Computer Science FieldHow to Answer Common Interview QuestionsCriminal Justice Education Through Distance LearningFind General Degree Programs from Accredited Colleges SchoolsA Day in the Life of an Online Masters Degree Student