™
g Easier!
Making Everythin
Fin an cia l
Ac co un tin g
Learn to:
• Determine what each line of a financial
statement tells you
• Identify the various accounting
concepts and methods that companies
can employ
• Recognize how investors and creditors
use financial reports to make decisions
Maire Loughran
Adjunct Full Professor of Financial &
Managerial Accounting
Certified Public Accountant
, Get More and Do More at Dummies.com ®
Start with FREE Cheat Sheets
Cheat Sheets include
• Checklists
• Charts
• Common Instructions
• And Other Good Stuff!
To access the Cheat Sheet created specifically for this book, go to
www.dummies.com/cheatsheet/financialaccounting
Get Smart at Dummies.com
Dummies.com makes your life easier with 1,000s
of answers on everything from removing wallpaper
to using the latest version of Windows.
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, Financial
Accounting
FOR
DUMmIES
‰
by Maire Loughran, CPA
, Financial Accounting For Dummies®
Published by
Wiley Publishing, Inc.
111 River St.
Hoboken, NJ 07030-5774
www.wiley.com
Copyright © 2011 by Wiley Publishing, Inc., Indianapolis, Indiana
Published by Wiley Publishing, Inc., Indianapolis, Indiana
Published simultaneously in Canada
No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or
by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permit-
ted under Sections 107 or 108 of the 1976 United States Copyright Act, without either the prior written
permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the
Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600.
Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley
& Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://
www.wiley.com/go/permissions.
Trademarks: Wiley, the Wiley Publishing logo, For Dummies, the Dummies Man logo, A Reference for the
Rest of Us!, The Dummies Way, Dummies Daily, The Fun and Easy Way, Dummies.com, Making Everything
Easier, and related trade dress are trademarks or registered trademarks of John Wiley & Sons, Inc. and/
or its affiliates in the United States and other countries, and may not be used without written permission.
All other trademarks are the property of their respective owners. Wiley Publishing, Inc., is not associated
with any product or vendor mentioned in this book.
LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: THE PUBLISHER AND THE AUTHOR MAKE NO
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY OR COMPLETENESS OF
THE CONTENTS OF THIS WORK AND SPECIFICALLY DISCLAIM ALL WARRANTIES, INCLUDING WITH-
OUT LIMITATION WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE. NO WARRANTY MAY BE
CREATED OR EXTENDED BY SALES OR PROMOTIONAL MATERIALS. THE ADVICE AND STRATEGIES
CONTAINED HEREIN MAY NOT BE SUITABLE FOR EVERY SITUATION. THIS WORK IS SOLD WITH THE
UNDERSTANDING THAT THE PUBLISHER IS NOT ENGAGED IN RENDERING LEGAL, ACCOUNTING, OR
OTHER PROFESSIONAL SERVICES. IF PROFESSIONAL ASSISTANCE IS REQUIRED, THE SERVICES OF
A COMPETENT PROFESSIONAL PERSON SHOULD BE SOUGHT. NEITHER THE PUBLISHER NOR THE
AUTHOR SHALL BE LIABLE F OR DAMAGES ARISING HEREFROM. THE FACT THAT AN ORGANIZA-
TION OR WEBSITE IS REFERRED TO IN THIS WORK AS A CITATION AND/OR A POTENTIAL SOURCE
OF FURTHER INFORMATION DOES NOT MEAN THAT THE AUTHOR OR THE PUBLISHER ENDORSES
THE INFORMATION THE ORGANIZATION OR WEBSITE MAY PROVIDE OR RECOMMENDATIONS IT
MAY MAKE. FURTHER, READERS SHOULD BE AWARE THAT INTERNET WEBSITES LISTED IN THIS
WORK MAY HAVE CHANGED OR DISAPPEARED BETWEEN WHEN THIS WORK WAS WRITTEN AND
WHEN IT IS READ.
For general information on our other products and services, please contact our Customer Care
Department within the U.S. at 877-762-2974, outside the U.S. at 317-572-3993, or fax 317-572-4002.
For technical support, please visit www.wiley.com/techsupport.
Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may
not be available in electronic books.
Library of Congress Control Number: 2011924129
ISBN: 978-0-470-93065-6
Manufactured in the United States of America
10 9 8 7 6 5 4 3 2 1
g Easier!
Making Everythin
Fin an cia l
Ac co un tin g
Learn to:
• Determine what each line of a financial
statement tells you
• Identify the various accounting
concepts and methods that companies
can employ
• Recognize how investors and creditors
use financial reports to make decisions
Maire Loughran
Adjunct Full Professor of Financial &
Managerial Accounting
Certified Public Accountant
, Get More and Do More at Dummies.com ®
Start with FREE Cheat Sheets
Cheat Sheets include
• Checklists
• Charts
• Common Instructions
• And Other Good Stuff!
To access the Cheat Sheet created specifically for this book, go to
www.dummies.com/cheatsheet/financialaccounting
Get Smart at Dummies.com
Dummies.com makes your life easier with 1,000s
of answers on everything from removing wallpaper
to using the latest version of Windows.
Check out our
• Videos
• Illustrated Articles
• Step-by-Step Instructions
Plus, each month you can win valuable prizes by entering
our Dummies.com sweepstakes. *
Want a weekly dose of Dummies? Sign up for Newsletters on
• Digital Photography
• Microsoft Windows & Office
• Personal Finance & Investing
• Health & Wellness
• Computing, iPods & Cell Phones
• eBay
• Internet
• Food, Home & Garden
Find out “HOW” at Dummies.com
*Sweepstakes not currently available in all countries; visit Dummies.com for official rules.
, Financial
Accounting
FOR
DUMmIES
‰
by Maire Loughran, CPA
, Financial Accounting For Dummies®
Published by
Wiley Publishing, Inc.
111 River St.
Hoboken, NJ 07030-5774
www.wiley.com
Copyright © 2011 by Wiley Publishing, Inc., Indianapolis, Indiana
Published by Wiley Publishing, Inc., Indianapolis, Indiana
Published simultaneously in Canada
No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or
by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permit-
ted under Sections 107 or 108 of the 1976 United States Copyright Act, without either the prior written
permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the
Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600.
Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley
& Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://
www.wiley.com/go/permissions.
Trademarks: Wiley, the Wiley Publishing logo, For Dummies, the Dummies Man logo, A Reference for the
Rest of Us!, The Dummies Way, Dummies Daily, The Fun and Easy Way, Dummies.com, Making Everything
Easier, and related trade dress are trademarks or registered trademarks of John Wiley & Sons, Inc. and/
or its affiliates in the United States and other countries, and may not be used without written permission.
All other trademarks are the property of their respective owners. Wiley Publishing, Inc., is not associated
with any product or vendor mentioned in this book.
LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: THE PUBLISHER AND THE AUTHOR MAKE NO
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY OR COMPLETENESS OF
THE CONTENTS OF THIS WORK AND SPECIFICALLY DISCLAIM ALL WARRANTIES, INCLUDING WITH-
OUT LIMITATION WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE. NO WARRANTY MAY BE
CREATED OR EXTENDED BY SALES OR PROMOTIONAL MATERIALS. THE ADVICE AND STRATEGIES
CONTAINED HEREIN MAY NOT BE SUITABLE FOR EVERY SITUATION. THIS WORK IS SOLD WITH THE
UNDERSTANDING THAT THE PUBLISHER IS NOT ENGAGED IN RENDERING LEGAL, ACCOUNTING, OR
OTHER PROFESSIONAL SERVICES. IF PROFESSIONAL ASSISTANCE IS REQUIRED, THE SERVICES OF
A COMPETENT PROFESSIONAL PERSON SHOULD BE SOUGHT. NEITHER THE PUBLISHER NOR THE
AUTHOR SHALL BE LIABLE F OR DAMAGES ARISING HEREFROM. THE FACT THAT AN ORGANIZA-
TION OR WEBSITE IS REFERRED TO IN THIS WORK AS A CITATION AND/OR A POTENTIAL SOURCE
OF FURTHER INFORMATION DOES NOT MEAN THAT THE AUTHOR OR THE PUBLISHER ENDORSES
THE INFORMATION THE ORGANIZATION OR WEBSITE MAY PROVIDE OR RECOMMENDATIONS IT
MAY MAKE. FURTHER, READERS SHOULD BE AWARE THAT INTERNET WEBSITES LISTED IN THIS
WORK MAY HAVE CHANGED OR DISAPPEARED BETWEEN WHEN THIS WORK WAS WRITTEN AND
WHEN IT IS READ.
For general information on our other products and services, please contact our Customer Care
Department within the U.S. at 877-762-2974, outside the U.S. at 317-572-3993, or fax 317-572-4002.
For technical support, please visit www.wiley.com/techsupport.
Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may
not be available in electronic books.
Library of Congress Control Number: 2011924129
ISBN: 978-0-470-93065-6
Manufactured in the United States of America
10 9 8 7 6 5 4 3 2 1
