Therapy For Your Money

Episode 90: The ABCs of Accounting (Part I)

February 17, 2023 Julie Herres Season 3 Episode 90
Therapy For Your Money
Episode 90: The ABCs of Accounting (Part I)
Show Notes

Welcome to the Therapy For Your Money School of Accounting! Today, Julie's going over key financial terms that are vital to running a successful business.

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  • A = Asset
    • Any resource owned or controlled by a business
  • B = Burn Rate
    • Measures your outgoing cash flow based on the money your practice typically spends each month
  • C = Cash Accounting
    • Method of accounting that only reflects transactions at the time the payment is actually received or made (versus accrual accounting method)
  • D = Double-Entry Bookkeeping
    • When each transaction has both a debit and a credit - this ensures accuracy, and balances your financial statement at all times
  • E = Expenses
    • Any cost associated with running your practice (includes a variety of things - payroll, office supplies, technology costs, rent/utilities, taxes, etc.)
  • F = Fiscal Year
    • The timeline that you use to budget your finances
  • G = General Ledger
    • Where every single transaction is accounted for in order to prepare budgets, taxes, audits, etc.

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