Conclusion
We’ve come a long way. Our fears of both accounting and financial reporting have melted away. We’ve learned the vocabulary; we’ve learned the structure. We know what FASB means and we appreciate the importance of GAAP.
We understand:
• That accrual has nothing to do with the Wicked Witch of the West. (pages 58–59)
• When negative cash flow is a sign of good things happening and when it is a sign of impending catastrophe. (page 195)
• Why discounts “drop” directly to the bottom line. (page 157)
• The important difference between liquidity and profitably. (pages 194–195)
• Those expenditures that are costs and those that are expenses. (page 50)
• Depreciation’s differing effect on income and on cash. (pages 118–119)
• Why product cost ...
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