Bucki Lisa A. - Idiots Guides: Introductory Accounting

No one likes a know-it-all. Most of us realize theres no such thinghow could there be? The world is far too complicated for someone to understand everything there is to know. So when you come across a know-it-all, you smile to yourself as they ramble on because you know better.

You understand that the quest for knowledge is a never-ending one, and youre okay with that. You have no desire to know everything, just the next thing. You know what you dont know, youre confident enough to admit it, and youre motivated to do something about it.

At Idiots Guides, we, too, know what we dont know, and we make it our business to find out. We find really smart people who are experts in their fields and then we roll up our sleeves and get to work, asking lots of questions and thinking long and hard about how best to pass along their knowledge to you in the easiest, most-accessible way possible.

After all, thats our promiseto make whatever you want to learn As Easy as It Gets. That means giving you a well-organized design that seamlessly and effortlessly guides you from page to page, topic to topic. It means controlling the pace youre asked to absorb new informationnot too much at once but just what you need to know right now. It means giving you a clear progression from easy to more difficult. It means giving you more instructional steps wherever necessary to really explain the details. And it means giving you fewer words and more illustrations wherever its better to show rather than tell.

So here you are, at the start of something new. The next chapter in your quest. It can be an intimidating place to be, but youve been here before and so have we. Clear your mind and turn the page. By the end of this book, you wont be a know-it-all, but your world will be a little less complicated than it was before. And well be sure your journey is as easy as it gets.

Mike Sanders
Publisher, Idiots Guides

Publisher: Mike Sanders

Associate Publisher: Billy Fields

Managing Editor: Lori Cates Hand

Cover Designer: Lindsay Dobbs

Book Designer: William Thomas

Compositor: Ayanna Lacey

Proofreader: Michelle Melani

Indexer: Tonya Heard

PRODUCTION, LONDON

Digital Producer: Alex Valizadeh

Senior Digital Producer: Miguel Cunha

DIGITAL OPERATIONS, DELHI

Head of Digital Operations: Manjari Hooda

Producer: Rahul Kumar

Assistant Editor: Etika Kapil

Operations Assistant: Tauhid Nasir

First American Edition, 2016
Published in the United States by DK Publishing
6081 E. 82nd Street, Indianapolis, Indiana 46250

Copyright 2016 Dorling Kindersley Limited
A Penguin Random House Company
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Published in the United States by Dorling Kindersley Limited.

IDIOTS GUIDES and Design are trademarks of Penguin Random House LLC

eISBN: 9781465450425
Library of Congress Catalog Card Number: 2015943281

Note: This publication contains the opinions and ideas of its author(s). It is intended to provide helpful and informative material on the subject matter covered. It is sold with the understanding that the author(s) and publisher are not engaged in rendering professional services in the book. If the reader requires personal assistance or advice, a competent professional should be consulted. The author(s) and publisher specifically disclaim any responsibility for any liability, loss, or risk, personal or otherwise, which is incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this book.

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Introduction

To use a sports analogy, accounting can be thought of as a way of keeping score within your business. Unlike a baseball game that results in a final score at the end, youre going to have multiple scores to keep track of in your business. For instance, how much cash do you have on hand? How much do your customers owe you? How much do you owe your vendors? How much have you spent on various aspects of your business? This scorekeeping is typically done on a calendar-month and calendar-year basis.

But now that much of accounting work is done with the help of a computer, you can easily keep score on a weekly or daily basis, or even in real time throughout the day.

In short, the main thing to remember is that accounting is what helps you learn about how your business is doing. How much information you want and how often you want it is up to you. This book helps you learn how to get the information (or the score, if you will).

In Idiots Guides: Introductory Accounting, we teach you how to know if your business is meeting your expectations and how your understanding of the basic accounting procedures can make you more successful. You also learn about the tools and best practices that help you keep your accounting scorecard accurate and up to date.

With easy-to-understand, plain English language and helpful examples from a variety of accounting software programs (rather than recommend a specific program), we break down the sometimes-complicated fundamentals of accounting so you can ensure your books balance.

How This Book Is Organized

This book is divided into six parts, each dealing with a different aspect of accounting.

, Laying the Groundwork, leads off with key accounting terminology youll encounter throughout the book. It also explains fundamental accounting concepts, such as how T accounts help you balance transactions and what types of transactions youll perform as part of your ongoing accounting routine. Part 1 also walks you through what you need to know from an accounting perspective when you start your business. We look at choosing the best legal structure, handling the cash invested in the business; choosing an accounting method; and filing the right documentation with federal, state, and local authorities.