Chapter 2

We've already learned about assets, but now we're going to break it down a bit further and differentiate between current and non-current.

We've already learned about Assets, but now we're going to break it down a bit further and differentiate between current and non-current.

We've already learned about Liabilities, but now we're going to break it down a bit further and differentiate between current and non-current.

We've already learned about Liabilities, but now we're going to break it down a bit further and differentiate between current and non-current.

Shareholder's Equity is made up of two different components: Retained Earning and Contributed Capital. Here, we try to figure out what contributed capital is all about.

The Classified Balance Sheet lets us see our assets and liabilities by groups, which gives us a little better overview.

T-Acounts are the 30,000 ft. view of your accounts. They help you quickly glance at an account and see what is going on inside of it.

Debits and Credits are the words of accounting. You must understand debits and credits if you want to be able to pass this class.

A "normal" balance just means what side of the account the increases go on. Here we're going to determine normal for Assets and Liabilities.

Shareholder's Equity has a normal balance, just like every other account. It's pretty simple to determine, not unlike Assets and Liabilities.

I told you that understanding normal balances is super important, so we're not done yet. This shortcut has to do with Double Entry Accounting. Excited? You probably should be.

You'll be DEAD if you forget this. Forgive my cheesiness.

The Journal, Ledger, and Trial Balance are how we keep track of what is going on day-to-day in our business.