CHAPTER 7THE BALANCE SHEET
WHAT’S A BALANCE SHEET? WHAT DOES IT MEAN?
So far, we have concerned ourselves mainly with generating income. After all, isn’t that why a business exists? For it is the income that eventually translates into cash, and it is the cash that can buy the yachts, villas, and other good things for the owners and managers of an enterprise.
However, for most businesses, success requires some tools. There was a time when many service businesses required only pencils, brooms, or shovels. That is no longer true. Bookkeepers need computers, janitors need vacuums and scrubbers, and ditch-diggers need backhoes.
Assume you and I each own separate ditch-digging operations, and you have a good backhoe and I have only a shovel and a wheelbarrow. ...