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Simple book keeping basics

There are tons of jargon on accounting. But a lot of them are rubbish that used for categorizing the incomes, expenses and Tax.

What really matters are Balance Sheet and P&L (profit & loss) statement. If you really knows to read and understand these two then you know the
basic language in business. 

I'll go deeper on these if you guys interest or else please Google and read about these two.

Let me share a real world example of what I am talking about. Here is the Access Engineering PLC / Annual Report 2015/16

Please go to page 149 of the report and you will see the Statement of Profit or Loss.

And on page 150 of the report you see the Balance sheet (they call it as Statement of Financial Position).
And you can see it is balanced (of cause it is balance sheet)
Total Assets = Total Equity and Liabilities

Basically these are the things that people are supposed look at before investing on a business.
And I am pretty sure guys like Warren Buffett ( are really using this to make their fortune.

This post first appeared on Inspiration Of CuttingEdge Technology, please read the originial post: here

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Simple book keeping basics


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