Welcome to "Understanding Accounting" !

When you finish this tutorial you will ....

• Know the purposes and limitations of the three main financial reports used in business organizations
• Understand the accounting equation and its system of debits and credits
• Know how common business transactions impact the financial statements
• Understand why the books have to be 'adjusted' at the end of the period
• Understand the end of period 'closing' process

Accounting is the language of business.  Accounting reports summarize the major organizational events that occur during a given time frame in terms dollars and cents. Financial reports tell the story of how an organization is doing.  If properly understood, financial reports can serve as a rudder to keep the organization on course for a healthy financial outcome.

Unfortunately,  many people do not understand the language of accounting and when confronted with financial reports they feel just as overwhelmed as a traveler in a foreign country without local language skills.  By taking this tutorial you are taking the first step to a better understanding of accounting reports and of financial issues in your organization.