Report Analysis - How to Read the Statements

An Explanation of Current Assets

The asset side of the balance sheet is divided into 3 major sections.  They include current assets, fixed assets, and other assets.  Current assets carry the most value to the small business entrepreneur because of […]

Accounting Concepts and Principles

What is Accrual Accounting?

Accrual accounting is the preferred method of accounting for all business operations.  Any publicly traded company must comply with the principles of accrual accounting.  Small business operations can choose between cash and accrual accounting for […]

Accounting Concepts and Principles

What is Amortization?

There are three methods of expensing an asset to the income statement.  The most common method is depreciation for fixed assets.  Mining, oil, and natural resource operations use depletion (amount removed versus the estimated volume on […]