Understanding Accrual Accounting

cash accrual accounting

Credit: Dreamstime

You all get a treat today, a guest blog by financial executive, Charles Seeman.  He wrote a great case study previously on this blog that get a lot of attention.  So, without further ado…

When I was a young junior staff accountant for a large regional CPA firm I, like all other junior staff people, were assigned to do “write up” work for some of our clients. Some of the older business people would play a game with junior staff accountants like me where they would tell us that they can guess the final net income number and be within a couple of thousand dollars of what is calculated by accrual accounting. At their skill at this amazed me, but after a while, I understood completely how this was done.

The purpose of this blog entry is to help young entrepreneurs understand and thus be able to predict how their business is doing. I want to help young entrepreneurs avoid the trials and tribulations that those older business owners endured to learn the skills necessary to be able to truly understand their business and how revenues and costs work. Read more of this post

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