Question: You can sell your product have revenues without receiving any
You can sell your product (have revenues) without receiving any money. You can receive money (customer deposits) without having any revenue. Since revenue, expenses, and cash are so different, why should a small business owner care about the income statement?
Answer to relevant QuestionsWhy would a small business ever need an accounting system more complicated than a simple checkbook register? Defend the statement, “the function of accounting is to produce information that is useful for decision making.” Discuss four methods to decrease cash outflows. Explain how borrowing money (1) increases firm value and (2) makes more money for a business owner. Why do you suppose that fewer than 15% of stolen heavy machines are ever recovered when the FBI reports that 62% of stolen automobiles are recovered?
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