Accounting Magic

By Dantes Joseph

This book assumes that you have no prior knowledge of accounting or finance, and delivers lessons and examples to build on your existing skills. Topics include accounting equation, debits and credits, inventory, Depreciation, assets, liabilities and equity accounts, bank reconciliation, petty cash and much much more. The book may be used as a study guide for those already taking accounting. Students who are struggling with accounting now, will find this to be a strong reinforcement to their current study. They will find this material easier to understand and therefore magically increase their confidence level. The Book also has LINKS TO ONLINE QUIZZES, with answer keys, including a Final Exam to help reinforce the material you learn!

• Language: English
• Publisher: Dantes Joseph
• Release date: Jun 4, 2020
• ISBN: 9781365958731

Book preview

Accounting Magic

Accounting M A GIC

Introduction to Accounting & Bookkeeping !

magic hat.png

First Edition

Copyright © 201 7   Dantes Joseph Jr.

All rights reserved.

ISBN 978-1-365-95873-1

Dantes Joseph

Margate, Florida 33063

USA

Introduction

This is an introductory book to accounting and finance designed to give you a great start in the wonderful and profitable field of accounting.  This book assumes that you have no prior knowledge of accounting or finance, and delivers lessons and examples to build on your existing skills. I try to follows a systematic process that allows non-accountants the opportunity to not only learn the techniques and principles involved, but also get an overall picture of the accounting cycle, step-by-step, through examples, exercises, flowcharts, diagrams and audio messages.

There is extensive focus on the fundamental accounting concepts as they are laid out by Generally Accepted Accounting Principles (GAAP). The book covers such topics as the accounting equation, the double entry system, debits and credits (a challenging area for newcomers!), the matching principle concept, inventory valuation: First in, First out (FIFO), Last in First out (LIFO), Specific Identification and Weighted Average methods . Depreciation charts explain and show the difference between straight-line depreciation, double declining balance, sum of the year’s digits and units of production . Depletion and Amortization are also discussed. We look into assets, liabilities and equity accounts (including contra-asset accounts), T-accounts, prepaid expenses, bank reconciliation, petty cash, posting transactions, adjusting entries, financial statements, closing entries, post-closing trial balance, ratio analysis and much more. An important accountant’s worksheet is presented that greatly simplifies the preparation of financial statements. Learn how to prepare and read the statement of Cash Flow to extract meaningful information about a company’s financial position.

After successful ly reading th is book , you will feel very confident about your accounting skills and may want to pursue it as a career. The book also allows you to analyze your skills and decide whether or not this is the right field for you . The book may also be used as a study guide for those already taking accounting. Students who are struggling with accounting now, will find this to be a strong reinforcement to their current study. They will find this material easier to understand and therefore increase their confidence level.

Job Opportunities In Accounting

Financial accounting has always been an interesting field. It has also been a challenging area because the material is not always easy to grasp the first time around. It is imperative that as you study accounting, you get a bigger and bigger picture of the whole cycle. You are going to learn that accounting has to do with gathering, sorting, recording and posting financial information in order to produce the ultimate end product   ( The Financial Statements) . Users of the financial statements include management in a company, government authorities, creditors and investors. The financial statements tell us the results of operations (income statement) and the financial position (balance sheet) of a company at a given point in time. Investors use   audited   financial statements in order to make decisions on whether or not to invest their hard earned money in a company.

You, as an accountant, will play a very important role. You will either be involved with processing the raw data needed to prepare the financial information that will be used by the general public, or you will be one who will analyze the finished product in order to render an opinion on the fairness of the information. The latter category of individuals is known as   Auditors . An auditor is still an accountant, however he goes beyond preparing the financial information: he reviews them and decides whether or not they are produced in conformity with certain government regulations that we will talk about in the book . These auditors frequently bear the title of   Certified Public Accountant (CPA) . You can be an accountant and not be an auditor. However, you cannot be an auditor without being an accountant.

As long as you can keep in mind that the ultimate objective of accounting is to produce financial information that will be used by the general public, you will be on the right track and the material will not be so difficult to understand. As you do this, you will also begin to have a global view of the entire accounting cycle in your mind so that you will know where in the cycle you are every step of the way.

In this book we will look at a lot of the   basic concepts   of accounting. These are the groundwork of the profession. You will need to get a solid understanding of these principles before you go to any intermediate or advance courses. Here is where you will have the most fun. The material is not too difficult. I have taken steps to simplify these principles so that you not only learn, but also enjoy them.

Do I need to be good at math to do well in accounting?

I’d like to share my personal experience with you. I went to Rockland Community College; a two-year school in Rockland County NY. I was coming to the last semester, having taken a lot of general courses since I was not yet sure what I wanted to major in. I thought, like most people, I’d take Business Administration. I’m convinced that many don’t really know what that major really is. It just seems to be a general field that should satisfy the demands they face to graduate. Anyway, I had to take Financial Accounting in order to graduate. When I looked at the textbook the other students were carrying around and I panicked. Not only was the book a thick one, but I saw a lot of numbers on the hard cover that seemed to indicate that there was a great deal of math involved. Math was not one of my strong points. At this stage I wasn’t sure what I was going to do.

Since I needed to take the class to graduate, I did just that. It was scheduled to meet at 9 a.m. on Saturday mornings. Our professor was a Certified Public Accountant (CPA). The class started off with about 35 students. I’ll never forget the instructor being very up-front in telling us that we had to concentrate very hard on the subject in order to pass his course. He went on to say that we could not have more than a certain number of absences, something like 3 or 4 for the entire semester. He argued that accounting is not like other classes. In other classes, if you miss a day, you can get notes from another student and catch up. Accounting however has a cumulative effect on your overall learning: every subject is built on the previous one. If you missed a topic on prepaid expense for example, the next time it’s discussed it will not be explained again. The teacher would move into