Accounting DeMYSTiFieD, 2nd Edition / Edition 2

Paperback (Print)
Used and New from Other Sellers
Used and New from Other Sellers
from $4.00
Usually ships in 1-2 business days
(Save 81%)
Other sellers (Paperback)
  • All (15) from $4.00   
  • New (8) from $12.65   
  • Used (7) from $4.00   


Accounting information and tips you can take to the bank!

You may not know the first thing about debits, credits, and cash ratios now—but when you’re done with this book, you’ll be able to juggle profits and losses with your eyes closed and read any balance sheet like it’s a good novel.

Accounting DeMySTiFieD, Second Edition, is a curriculum-based, self-teaching guide that makes learning accounting easier than 1-2-3. With graphs, plain-English explanations, and real-life examples, it starts with the fundamentals—such as basic financial terms, balance sheets, and cash flow statements—and eases you into the more complicated stuff, like adjusting entries, double entry bookkeeping, profit ratios, and liquidity.

Completely updated and revised to cover finance terms, theories, and best practices, Accounting DeMySTiFieD teaches you the ins and outs of accounting in no time at all.

This fast and easy guide features:

  • A complete overview of financial statements, GAAP rules, transactions, cost, budgets, and tax accounting
  • Proven accounting insights, tips, strategies, and techniques
  • Chapter-ending practice exercises, quizzes, and final exam to reinforce your knowledge and chart progress
  • Tons of examples to show how accounting works in the real world

Simple enough for a beginner but challenging enough for a more advanced student, Accounting DeMySTiFieD is your shortcut to mastery of this otherwise complex subject.

Read More Show Less

Product Details

  • ISBN-13: 9780071763738
  • Publisher: McGraw-Hill Professional Publishing
  • Publication date: 7/21/2011
  • Series: Demystified Series
  • Edition number: 2
  • Pages: 352
  • Sales rank: 470,953
  • Product dimensions: 8.92 (w) x 7.38 (h) x 0.88 (d)

Meet the Author

McGraw-Hill authors represent the leading experts in their fields and are dedicated to improving the lives, careers, and interests of readers worldwide

Read More Show Less

Read an Excerpt

Accounting DeMYSTiFieD

By Leita Hart-Fanta

The McGraw-Hill Companies, Inc.

Copyright © 2011The McGraw-Hill Companies, Inc.
All rights reserved.
ISBN: 978-0-07-177097-2



Where Did All This Lingo Come From?

Business is very simple. Money flows into an organization, and money flows out. But we in the finance and accounting profession sometimes get a little out of hand giving fancy names to very simple concepts. This fancy lingo can cause more than a little bit of confusion. So it is helpful to envision accounting as a foreign language. Most of the rules and concepts are perfectly intuitive and simple; you just have to know what to call them.

The title of this book, Accounting Demystified, is very appropriate. It is definitely attributing too much romance and intrigue to the profession to call it a mystery, but it does probably sell a few more books than the title, Clarifying Accounting Lingo. (This is why I am writing and someone else is marketing this book!)


• Describe the origin and general purpose of accounting

• Introduce the three key financial statements

I want to give you the ability to have an intelligent conversation with an accountant or finance person. I want you to be able to justify your actions in terms that the folks holding the purse strings can understand and appreciate. I want you to be able to go to meetings with your management team and understand what the heck they are talking about. I don't want you to have to nod your head like you understand when you don't, so I am going to give you the knowledge to ask intelligent questions regarding finance.

What I am not going to do is bore you or muddy the waters with a load of unnecessary detail. You know, I was out of college and already had my certified public accountant (CPA) certificate before all the detail the accounting professors had me memorize gelled together in my head to form a big picture. I am going to take the opposite approach with you. We are going to start with the big picture and then go into a bit of detail. We are not going to go into super detail. I think it is best to keep it at a high level.

I am not going to tell you how to handle an advance repurchase agreement on stock or how to calculate a bond discount. This is too much detail for 99.99 percent of the population—and probably you. However, if you do need this kind of detail, this book will give you the basis to start asking those questions and understanding what the finance person says in response.

As Glinda the Good Witch says in The Wizard of Oz, "It is always best to start at the beginning." So let's take a minute to get a sense of how this system we have in place began a long time ago. It actually started in a very romantic and sometimes mysterious and dramatic place—Italy.

The Birth of the Accountant

The system we use today to track money in business was invented in Italy during the Renaissance. An Italian merchant invented it so that he could easily summarize his results at the end of the day. The system had a simple method of checks and balances to make sure that everything he had recorded was done correctly.

The Italian merchant called his system the double-entry accounting system, and it was very simple to understand. Each and every transaction must balance. The "ins" had to equal the "outs." This is the root of debits and credits that we will talk about in more detail in Chapter 6.

For instance, let's say this merchant sold jewelry. When he sold a piece of jewelry, the jewelry went out of his business. In return something came in— some cash. Through a series of entries in his books, the ins would equal the outs.

With this system, the merchant could make sure that every transaction was recorded completely because the books had to balance. If the books didn't balance, the merchant knew that he had missed something.

This system also was useful in that it posted the information to discrete accounts or categories that could be summarized at the end of the day. The merchant could look at his cash account category and see how much cash he had brought in that day; he could look at his jewelry inventory category to see how much jewelry he had left to sell. All very convenient.

This system was so convenient and useful that the merchant decided to share it with his friends. His friends liked it, and because Italy was a trade center, soon businesses all over the world were using the system. (Don't ask me what they were doing previous to this; I imagine just keeping a list of cash on long sheets of parchment.)

But the folks who were the most excited about this new system were the lenders—the banks and financiers who gave merchants money to expand their businesses. Before this system, the banks and financiers had to rely on subjective information to decide who to loan money to. They made decisions based on family reputation, where they lived, or what kind of carriage they drove. Now they could decide based on some real hard data.

The only problem is that everyone's data looked a little different because they all used different rules. They chose how to treat a transaction according to how good it made their books look.

For example, let's say that you are a sales representative for the famous artist Michelangelo. Your job is to find him commissions so that he can concentrate on his art, not on selling. The head of the Medici family, a very influential and wealthy Italian family, has commissioned Michelangelo—through you—to sculpt a replica of David for the foyer of the family villa.

When do you record a sale in your books? When you shake hands with the head of the Medici clan and say, "We'll have it to you in three years"? Or when Michelangelo puts chisel to marble? Or when the statue is installed in the villa? Do you record a sale when you bill for the statue or when the Medicis pay in cash?

All these viewpoints have validity. The lenders didn't like this at all. They desired consistency. They wanted everyone to use the same rules so that their financial statements would be comparable. They wanted to know, when choosing to invest in one of three businesses, which business actually was doing better.

The lenders demanded rules so that everyone would be consistent. It was then that accountants were born. Accountants are just the folks who know the rules on how to keep the records consistent. A dark day in the annals of history, I know, but....

Gaps in GAAP?

Nowadays accounting rules are voluminous. The standards that accountants use to create financial statements are called generally accepted accounting principles (GAAP). There is a set of GAAP that applies to most everyone, and then there is GAAP for specific industries. The oil and gas business has different transactions than a software developer, so we have to have different rules for each group.

GAAP is created by a rule-making body called the Financial Accounting Standards Board (FASB, pronounced "faz-bee"). Governmental entities such as cities and counties have their own rule-setting body called the Governmental Accounting Standards Board (GASB, pronounced "gaz-bee").

Unfortunately, GAAP is full of gaps or loopholes. GAAP is designed to make financial statements comparable and consistent. And generally, most transactions are treated conservatively, meaning that transactions are not recorded until we are absolutely sure that the transaction will occur or actually has occurred.

But some organizations take advantage of the gaps in GAAP just to make their financial statements look a little bit better than those of their competitors. Wealthy folks hire savvy tax accountants to find shelte

Excerpted from Accounting DeMYSTiFieD by Leita Hart-Fanta. Copyright © 2011 by The McGraw-Hill Companies, Inc.. Excerpted by permission of The McGraw-Hill Companies, Inc..
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Read More Show Less

Table of Contents




Part I The Big Picture....................          

CHAPTER 1 Where Did All This Lingo Come From?....................          

CHAPTER 2 The Balance Sheet—The Mother of All Financial Statements..............          

CHAPTER 3 The Income Statement—A Focus on Earnings....................          

CHAPTER 4 The Cash-Flow Statement—Do We Have Enough for Payroll?................          

CHAPTER 5 How the Financial Statements Are Related....................          

Part II An Overview of Common Accounting Reports....................          

CHAPTER 6 Different Systems, Different Reports....................          

CHAPTER 7 Quarterly and Annual Financial Reports—A Tour....................          

Part III Debits and Credits Detail—Rules, Rules, Rules....................          

CHAPTER 8 How to Tell if Something Is a Debit or a Credit....................          

CHAPTER 9 A Few Simple Transactions....................          

CHAPTER 10 Inventory Valuation....................          

CHAPTER 11 Guiding Principles of Accounting and Adjusting Entries....................          

CHAPTER 12 Governmental and Not-for-Profit Accounting....................          

Part IV Financial Indicators—Using Financial Information to Make Decisions......          

CHAPTER 13 Cautions about Financial Analysis....................          

CHAPTER 14 Conducting a Financial Analysis—The Prep Work....................          

CHAPTER 15 Profit Ratios....................          

CHAPTER 16 Liquidity and Financial Flexibility....................          

CHAPTER 17 Cash Ratios....................          

CHAPTER 18 Financing Ratios....................          

Final Exam....................          

Answers to Quizzes and Final Exam....................          


Read More Show Less

Customer Reviews

Be the first to write a review
( 0 )
Rating Distribution

5 Star


4 Star


3 Star


2 Star


1 Star


Your Rating:

Your Name: Create a Pen Name or

Barnes & Review Rules

Our reader reviews allow you to share your comments on titles you liked, or didn't, with others. By submitting an online review, you are representing to Barnes & that all information contained in your review is original and accurate in all respects, and that the submission of such content by you and the posting of such content by Barnes & does not and will not violate the rights of any third party. Please follow the rules below to help ensure that your review can be posted.

Reviews by Our Customers Under the Age of 13

We highly value and respect everyone's opinion concerning the titles we offer. However, we cannot allow persons under the age of 13 to have accounts at or to post customer reviews. Please see our Terms of Use for more details.

What to exclude from your review:

Please do not write about reviews, commentary, or information posted on the product page. If you see any errors in the information on the product page, please send us an email.

Reviews should not contain any of the following:

  • - HTML tags, profanity, obscenities, vulgarities, or comments that defame anyone
  • - Time-sensitive information such as tour dates, signings, lectures, etc.
  • - Single-word reviews. Other people will read your review to discover why you liked or didn't like the title. Be descriptive.
  • - Comments focusing on the author or that may ruin the ending for others
  • - Phone numbers, addresses, URLs
  • - Pricing and availability information or alternative ordering information
  • - Advertisements or commercial solicitation


  • - By submitting a review, you grant to Barnes & and its sublicensees the royalty-free, perpetual, irrevocable right and license to use the review in accordance with the Barnes & Terms of Use.
  • - Barnes & reserves the right not to post any review -- particularly those that do not follow the terms and conditions of these Rules. Barnes & also reserves the right to remove any review at any time without notice.
  • - See Terms of Use for other conditions and disclaimers.
Search for Products You'd Like to Recommend

Recommend other products that relate to your review. Just search for them below and share!

Create a Pen Name

Your Pen Name is your unique identity on It will appear on the reviews you write and other website activities. Your Pen Name cannot be edited, changed or deleted once submitted.

Your Pen Name can be any combination of alphanumeric characters (plus - and _), and must be at least two characters long.

Continue Anonymously

    If you find inappropriate content, please report it to Barnes & Noble
    Why is this product inappropriate?
    Comments (optional)