Going for the Big Equation
In This Chapter
Revealing the inner life of Pacioli’s debits and credits (makes Isaac Newton seem tame)
Inserting a little loving back in the air — pairing up those debits and credits
Taking a peek into the inner workings of accounting software
Choosing between hand-to-mouth cash and high-tech accrual
If you want to be a racing driver, it pays to understand something about the mechanics of a car. If all you want to do is drive from A to B, you can rely on others to bail you out, and go from one year to the next without looking under the bonnet.
The same goes for bookkeeping. If you’re a business owner and you want to do your books in a simple fashion, giving them to your accountant for the finishing touches, you can get by without ever worrying about double-entry bookkeeping. (Yep, you’re off the hook — you can skip reading this chapter and proceed to the more interesting stuff.)
However, if you’re serious about bookkeeping, knowing the theory of how bookkeeping works and what goes on behind the scenes is vital. An understanding of debits and ...