When we talk about small business accounting, or accounting in general, we are dealing with transactions for a business to report for compliance, as well as to measure the health of the business based on financial data.

Some users of accounting data:
-Owners-managers
-Shareholders
-Banks-Financial institutions
-Potential buyers and sellers of businesses

Accounting – 5 different types of accounts
-Revenue/Income
-Expenses – Costs
-Assets
-Liabilities
-Equity

3 Main Financial Statements used for accounting purposes:

-Income statement: Income – Expenses = Profit/taxable income
-Balance sheet: Assets = Liabilities + Equity
-A picture of a business’ financial health in a moment in time
-Statement of cash flows