Accounting

Practice (Feb 28 and March 1):
Use the templates below to add formulae and complete the exercises in the. [|Income Statement Template.xls] - insert a new worksheet for each business (not a new file).

Accounting Equation
Assets = Liabilities + Owner's Equity

Owner's Equity
Owner's Equity = Assests - Liabilities

Income Statements
Notes:


 * Types of Business:**
 * Wholesaler** - buys in large quantities and sells to retailers
 * Retail** - sells items to consumers
 * Service** - provides a service for the customer


 * Terms**

**Revenue** - Money received from the sale of goods or services.

 * Expenses** - The money spent to run the business
 * Cost of Goods Sold** - The price the business pays to buy items
 * Gross income** - The difference between total revenue and the cost of goods sold (Revenue - Cost = Gross Income)
 * Net income (loss or profit)** - The money left over after all the expenses have been paid.
 * Revenue - Expenses = Net income**