Yale Fishman ESQ: What Is Accounting?
Anyone who’s worked in an office at some point or another has had to go to accounting. Yale M Fishman says they’re the people who pay and send out the bills that keep the business running. They do a lot more than that, though. Sometimes referred to as “bean counters” they also keep their eye on profits, costs, and losses. Unless you’re running your own business and acting as your own accountant, you’d have no way of knowing just how profitable – or not – your business is without some form of accounting.
No matter what business you’re in, Yale Fishman Attorney claims that even if all you do is balance a checkbook, that’s still accounting. It’s part of even a kid’s life. Saving an allowance, spending it all at once – these are accounting principles.
What are some other businesses where accounting is critical? Well, farmers need to follow careful accounting procedures. Many of them run their farms year to year by taking loans to plant the crops. If it’s a good year, a profitable one, then they can pay off their loan; if not, they might have to carry the loan over, and accrue more interest charges, says Yale Fishman from Yale Fishman Associates.
Every business and every individual needs to have some kind of accounting system in their lives. Otherwise, the finances can get away from them; they don’t know what they’ve spent, or whether they can expect a profit or a loss from their business. Staying on top of accounting, whether it’s for a multi-billion dollar business or for a personal checking account is a necessary activity on a daily basis if you’re smart. Not doing so can mean anything from a bounced check or posting a loss to a company’s shareholders. Both scenarios can be equally devastating.
Accounting is basically information that is published periodically in business as a profit and loss statement, or an income statement.
Basic Accounting Principles – Yale Fishman Associates
The Professor of Accounting at the University of Michigan William A Paton defines accounting as having one basic function: “facilitating the administration of economic activity. This function has two closely related phases:
- measuring and arraying economic data; and
- communicating the results of this process to interested parties.” – says Yale M Fishman Attorney.
As an example, a company’s accountants periodically measure the profit and loss for a month, a quarter, or a fiscal year. These results are published in a statement of profit and loss that’s called an income statement. These statements include elements such as accounts receivable (what’s owed to the company) and accounts payable (what the company owes). It can also get pretty complicated with subjects like retained earnings and accelerated depreciation. This is at the higher levels of accounting and in the organization.
According to Yale Fishman NY, much of accounting though is also concerned with basic bookkeeping. This is the process that records every transaction; every bill paid, every dime owed, every dollar and cent spent and accumulated.
But the owners of the company, which can be individual owners or millions of shareholders are most concerned with the summaries of these transactions, contained in the financial statement. The financial statement summarizes a company’s assets. A value of an asset is what it cost when it was first acquired. The financial statement also records the sources of the assets. Some assets are in the form of loans that have to be paid back. Profits are also an asset of the business, finished Yale Martin Fishman.
In what’s called double-entry bookkeeping, the liabilities are also summarized. Obviously, a company wants to show a higher amount of assets to offset the liabilities and show a profit. The management of these two elements is the essence of accounting.
There is a system for doing this; not every company or individual can devise their own systems for accounting; the result would be chaos!