Preface | |
Numbers, Numbers, Numbers: The Why and the How | p. 1 |
Statistics and Numbers That Confound Us | p. 1 |
Scores: Numbers We Enjoy | p. 2 |
Simplicity Makes It Easier | p. 2 |
Going into Business (Our Novel) | p. 3 |
Basic Concept (Cash Accounting and Accrual Accounting) | p. 4 |
When to Use and Not Use Cash Accounting | p. 7 |
A Few Basic Terms | p. 7 |
Financial Statements and Reports | p. 8 |
Generally Accepted Accounting Principles (GAAP) | p. 9 |
Who Makes the Rules? Who Defines GAAP? | p. 9 |
Summary | p. 10 |
Keeping Score: Sales | p. 13 |
What Is a Sale? | p. 13 |
Types of Sale | p. 14 |
Reduction of Sales | p. 18 |
Reports | p. 28 |
Summary | p. 28 |
Keeping Score: Cost of Sales | p. 31 |
Cost of Goods Sold | p. 31 |
Inventory | p. 31 |
Freight on Purchases | p. 38 |
Discounts on Goods Purchased | p. 40 |
Cost of Services | p. 42 |
Summary | p. 43 |
Keeping Score: Expenses | p. 45 |
Expenses, What Are They? How Are They Reported? | p. 45 |
Expense Classification, In General | p. 46 |
Alphabetical or Size Order | p. 46 |
Detailed, by Department or Division | p. 47 |
Controllable and Uncontrollable Expenses | p. 51 |
Summary Reports (Just the Essentials) | p. 53 |
Variable and Fixed Expenses, Breakeven Point | p. 54 |
Direct and Indirect Expenses | p. 61 |
Summary | p. 62 |
Equipment and Other Things That Will Be Around for Years | p. 65 |
Depreciation: How Much Does It Cost to Have the Stuff Around? | p. 65 |
Which Way to Compute Depreciation? | p. 68 |
Tax Depreciation vs. Financial Depreciation | p. 73 |
Small Bits and Pieces of Equipment | p. 74 |
Reserve for Depreciation | p. 75 |
When the Equipment Is Sold, Lost, Junked, or Stolen | p. 76 |
Trade-Ins | p. 77 |
Repair or Refurbishment of Equipment | p. 78 |
Intangibles (Profit-Making Things That Aren't There) | p. 79 |
Summary | p. 80 |
Buying, Leasing, or Doing Without | p. 83 |
Justifying the Purchase of Equipment | p. 83 |
Repair or Replace | p. 92 |
Leasing: Painless(?) Purchasing | p. 94 |
A Word on Income Tax Lease Rules | p. 96 |
A Budgeting Communication Problem | p. 96 |
Summary | p. 97 |
The Balance Sheet | p. 100 |
What's a Balance Sheet? What Does It Mean? | p. 100 |
Assets | p. 102 |
Liabilities | p. 106 |
Working Capital | p. 112 |
Notes to the Financial Statements | p. 112 |
Equity - The "Balance" Part | p. 113 |
Summary | p. 115 |
Ownership and Equity | p. 117 |
Make a Killing in Equity? | p. 117 |
Building Equity | p. 117 |
Statement of Change in Owner's Equity | p. 122 |
Equity in a Partnership | p. 123 |
Corporate Equity | p. 124 |
Valuation of Common Stock | p. 131 |
Types of Corporations | p. 132 |
Summary | p. 133 |
Budgeting/Planning | p. 136 |
What Is Budgeting? | p. 136 |
Keeping Score | p. 137 |
The Starting Point | p. 137 |
The Spouse House Company Plan | p. 138 |
Resulting Sales Budget | p. 140 |
Cost of Goods Sold Budget | p. 144 |
Expense Budget | p. 145 |
Budget Summary | p. 150 |
Zero-Based Budgeting | p. 152 |
Summary | p. 152 |
Budget Reporting and More Budgets | p. 155 |
Warning | p. 155 |
Budget Reports | p. 155 |
Reports, Reports, and More Reports | p. 158 |
Flexible Budgets | p. 159 |
Cash Budget | p. 166 |
Other Budgets | p. 170 |
Let the Accountants Worry with the Budget? | p. 170 |
Obligation of Budgeted Amounts | p. 171 |
Summary | p. 172 |
Manufacturing and Construction | p. 175 |
Cost of a Manufactured Spouse House | p. 176 |
Costs/Expenses - Which Went Where? | p. 179 |
Inventories and Fluctuating Costs | p. 181 |
Unit Costs | p. 182 |
Standard Costs | p. 184 |
Variations in Standard Costs and Budgets | p. 186 |
Process Costs/Job Costs | p. 188 |
Work-in-Process Inventory | p. 188 |
The Contracting Business | p. 189 |
Summary | p. 194 |
Analysis of an Enterprise | p. 197 |
The Income Statement | p. 198 |
The Balance Sheet | p. 203 |
Retained Earnings Statement | p. 205 |
Ratios | p. 205 |
Cash Flow Statement | p. 217 |
Notes to the Financial Statements | p. 220 |
Can You Trust the Financial Statements? | p. 220 |
Summary | p. 222 |
Appendix A: Flexible Budget Computations | p. 227 |
Appendix B: Sources of Industry Averages | p. 229 |
Appendix C: Sources of Information on Publicly Held Corporations | p. 230 |
Appendix D: Dates Pertinent to Dividends on Publicly Held Stock | p. 232 |
Appendix E: Classes of Common Stock and Preferred Stock | p. 233 |
Appendix F: Goodwill | p. 235 |
Appendix G: Nonprofit Organizations | p. 237 |
Answer Key to Review Questions and Case Studies | p. 239 |
Glossary | p. 251 |
Index | p. 261 |
Final Examination (follows Index) | p. 1 |
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