![[Review] Accounting 101 (Michele Cagan CPA) Summarized](https://episodes.castos.com/660078c6833215-59505987/images/2304369/c1a-085k3-pkvzoj33t5m-wp9kux.jpg)
Show Notes
Accounting 101 (Michele Cagan CPA)
- Amazon USA Store: https://www.amazon.com/dp/B01N5TMOHW?tag=9natree-20
- Amazon Worldwide Store: https://global.buys.trade/Accounting-101-Michele-Cagan-CPA.html
- Apple Books: https://books.apple.com/us/audiobook/accounting-101-unabridged/id1754179610?itsct=books_box_link&itscg=30200&ls=1&at=1001l3bAw&ct=9natree
- eBay: https://www.ebay.com/sch/i.html?_nkw=Accounting+101+Michele+Cagan+CPA+&mkcid=1&mkrid=711-53200-19255-0&siteid=0&campid=5339060787&customid=9natree&toolid=10001&mkevt=1
- Read more: https://mybook.top/read/B01N5TMOHW/
#accountingbasics #financialstatements #debitsandcredits #bookkeepingfundamentals #cashflow #Accounting101
These are takeaways from this book.
Firstly, Accounting as a System for Tracking Business Reality, A central theme is that accounting is not just math, but a structured method for capturing what happens in an organization. The book explains why financial information must be consistent and comparable, and how accounting creates a common language for decision making. It outlines how transactions are identified, categorized, recorded, and summarized so that the resulting reports reflect reality in a useful way. This includes the purpose of documentation, the idea of an audit trail, and why accuracy matters beyond simple compliance. It also highlights the difference between bookkeeping, which focuses on recording, and accounting, which interprets and presents results for planning and evaluation. Readers learn the role of standards and common practices that prevent financial statements from becoming arbitrary. By grounding the subject in everyday examples such as sales, bills, payroll, and purchasing equipment, the book makes it easier to see how operational choices shape financial outcomes. This topic gives beginners a mental map of the entire process, preparing them to understand later chapters on statements, accounts, and measurement without feeling lost in terminology.
Secondly, The Core Financial Statements and How They Connect, The book emphasizes the three primary financial statements and the way they fit together: the income statement, the balance sheet, and the cash flow statement. It clarifies what each report is designed to answer and what common misunderstandings can occur when a reader focuses on only one. The income statement shows performance over a period, including revenue, expenses, and profit. The balance sheet provides a snapshot of financial position, organizing assets, liabilities, and equity and demonstrating why the accounting equation must balance. Cash flow reporting addresses a frequent beginner confusion: profitability does not automatically mean positive cash. By explaining how cash moves through operating, investing, and financing activities, the book helps readers interpret liquidity and sustainability. This topic also explains how transactions affect multiple statements, such as buying equipment, taking on debt, or extending credit to customers. Understanding the connections trains readers to read statements as a coherent story rather than isolated pages, improving their ability to spot risk, evaluate progress, and ask smarter questions of accountants or financial software.
Thirdly, Debits, Credits, and the Logic of Double Entry, A major hurdle for beginners is the debit and credit framework, and the book addresses it by focusing on structure over memorization. It introduces double entry accounting as a system where every transaction affects at least two accounts, preserving balance and making errors easier to detect. Readers learn that debit and credit are directional terms within an accounting framework, not simply synonyms for decrease and increase in everyday speech. The book explains account categories such as assets, liabilities, equity, revenue, and expenses, and shows how normal balances work within each category. It also covers how journals and ledgers fit into the process and why posting and reconciliation matter. By working through common scenarios like making a sale, paying a bill, recording a loan, or purchasing inventory, the book helps readers practice thinking in impacts rather than isolated numbers. This topic builds the conceptual muscles needed to understand bookkeeping outputs from accounting software, communicate with professionals, and catch issues like misclassified expenses, missing entries, or transactions recorded in the wrong period.
Fourthly, Revenue, Expenses, Profit, and Timing Decisions, The book explores how businesses measure financial performance and why timing can change the story. It explains the difference between revenue and cash received, and between expenses and cash paid, introducing the logic behind accrual thinking and matching costs to the revenue they help generate. Readers see how profit can be influenced by when revenue is recognized, how inventory and cost of goods sold affect margins, and why depreciation spreads the cost of long lived assets across time. The topic also clarifies gross profit versus net profit, and why understanding expense categories matters for budgeting and performance analysis. In addition, the book highlights common performance pitfalls such as growing sales while losing money, or appearing profitable while running out of cash due to slow customer payments. By focusing on practical interpretation, it helps readers evaluate business health beyond a single bottom line number. This section is especially useful for entrepreneurs and managers who need to understand what drives results and how operational decisions like pricing, purchasing, staffing, and credit terms translate into accounting outcomes.
Lastly, Assets, Liabilities, Equity, and Financial Health, A key part of accounting basics is understanding what a business owns and owes, and what is left for the owners. The book breaks down assets into current and non current categories, explaining how items like cash, accounts receivable, inventory, and equipment behave differently and carry different risks. It also discusses liabilities such as accounts payable, loans, and accrued obligations, showing how debt can support growth but also introduces repayment pressure and interest costs. Equity is presented as the residual claim, shaped by owner contributions and retained earnings over time. The topic ties these ideas to practical measures of financial health, including liquidity and solvency thinking, and why a strong balance sheet can make it easier to survive downturns or invest in opportunities. It also reinforces how transactions like borrowing money, buying inventory on credit, or collecting receivables shift the balance sheet even if profit does not change immediately. This perspective equips readers to interpret balance sheet changes, assess stability, and understand the trade offs behind financing and operating decisions.
- Amazon USA Store: https://www.amazon.com/dp/B01N5TMOHW?tag=9natree-20
- Amazon Worldwide Store: https://global.buys.trade/Accounting-101-Michele-Cagan-CPA.html
- Apple Books: https://books.apple.com/us/audiobook/accounting-101-unabridged/id1754179610?itsct=books_box_link&itscg=30200&ls=1&at=1001l3bAw&ct=9natree
- eBay: https://www.ebay.com/sch/i.html?_nkw=Accounting+101+Michele+Cagan+CPA+&mkcid=1&mkrid=711-53200-19255-0&siteid=0&campid=5339060787&customid=9natree&toolid=10001&mkevt=1
- Read more: https://mybook.top/read/B01N5TMOHW/
#accountingbasics #financialstatements #debitsandcredits #bookkeepingfundamentals #cashflow #Accounting101
These are takeaways from this book.
Firstly, Accounting as a System for Tracking Business Reality, A central theme is that accounting is not just math, but a structured method for capturing what happens in an organization. The book explains why financial information must be consistent and comparable, and how accounting creates a common language for decision making. It outlines how transactions are identified, categorized, recorded, and summarized so that the resulting reports reflect reality in a useful way. This includes the purpose of documentation, the idea of an audit trail, and why accuracy matters beyond simple compliance. It also highlights the difference between bookkeeping, which focuses on recording, and accounting, which interprets and presents results for planning and evaluation. Readers learn the role of standards and common practices that prevent financial statements from becoming arbitrary. By grounding the subject in everyday examples such as sales, bills, payroll, and purchasing equipment, the book makes it easier to see how operational choices shape financial outcomes. This topic gives beginners a mental map of the entire process, preparing them to understand later chapters on statements, accounts, and measurement without feeling lost in terminology.
Secondly, The Core Financial Statements and How They Connect, The book emphasizes the three primary financial statements and the way they fit together: the income statement, the balance sheet, and the cash flow statement. It clarifies what each report is designed to answer and what common misunderstandings can occur when a reader focuses on only one. The income statement shows performance over a period, including revenue, expenses, and profit. The balance sheet provides a snapshot of financial position, organizing assets, liabilities, and equity and demonstrating why the accounting equation must balance. Cash flow reporting addresses a frequent beginner confusion: profitability does not automatically mean positive cash. By explaining how cash moves through operating, investing, and financing activities, the book helps readers interpret liquidity and sustainability. This topic also explains how transactions affect multiple statements, such as buying equipment, taking on debt, or extending credit to customers. Understanding the connections trains readers to read statements as a coherent story rather than isolated pages, improving their ability to spot risk, evaluate progress, and ask smarter questions of accountants or financial software.
Thirdly, Debits, Credits, and the Logic of Double Entry, A major hurdle for beginners is the debit and credit framework, and the book addresses it by focusing on structure over memorization. It introduces double entry accounting as a system where every transaction affects at least two accounts, preserving balance and making errors easier to detect. Readers learn that debit and credit are directional terms within an accounting framework, not simply synonyms for decrease and increase in everyday speech. The book explains account categories such as assets, liabilities, equity, revenue, and expenses, and shows how normal balances work within each category. It also covers how journals and ledgers fit into the process and why posting and reconciliation matter. By working through common scenarios like making a sale, paying a bill, recording a loan, or purchasing inventory, the book helps readers practice thinking in impacts rather than isolated numbers. This topic builds the conceptual muscles needed to understand bookkeeping outputs from accounting software, communicate with professionals, and catch issues like misclassified expenses, missing entries, or transactions recorded in the wrong period.
Fourthly, Revenue, Expenses, Profit, and Timing Decisions, The book explores how businesses measure financial performance and why timing can change the story. It explains the difference between revenue and cash received, and between expenses and cash paid, introducing the logic behind accrual thinking and matching costs to the revenue they help generate. Readers see how profit can be influenced by when revenue is recognized, how inventory and cost of goods sold affect margins, and why depreciation spreads the cost of long lived assets across time. The topic also clarifies gross profit versus net profit, and why understanding expense categories matters for budgeting and performance analysis. In addition, the book highlights common performance pitfalls such as growing sales while losing money, or appearing profitable while running out of cash due to slow customer payments. By focusing on practical interpretation, it helps readers evaluate business health beyond a single bottom line number. This section is especially useful for entrepreneurs and managers who need to understand what drives results and how operational decisions like pricing, purchasing, staffing, and credit terms translate into accounting outcomes.
Lastly, Assets, Liabilities, Equity, and Financial Health, A key part of accounting basics is understanding what a business owns and owes, and what is left for the owners. The book breaks down assets into current and non current categories, explaining how items like cash, accounts receivable, inventory, and equipment behave differently and carry different risks. It also discusses liabilities such as accounts payable, loans, and accrued obligations, showing how debt can support growth but also introduces repayment pressure and interest costs. Equity is presented as the residual claim, shaped by owner contributions and retained earnings over time. The topic ties these ideas to practical measures of financial health, including liquidity and solvency thinking, and why a strong balance sheet can make it easier to survive downturns or invest in opportunities. It also reinforces how transactions like borrowing money, buying inventory on credit, or collecting receivables shift the balance sheet even if profit does not change immediately. This perspective equips readers to interpret balance sheet changes, assess stability, and understand the trade offs behind financing and operating decisions.
