drindox
Re:Accounting for Computer Scientists
on Wednesday March 09, 2011 @08:15AM (#2304725)
A good effort but all the sign flipping gets confusing
Re:Accounting for Computer Scientists
on Wednesday March 09, 2011 @07:20AM (#2304650)
Equity is on the same side of the balance sheet as liabilities because of the accounting equation: Assets = Capital + Liabilities.
See this tutorial as well: http://www.principlesofaccounting.com/chapter%201.htm
Re:Accounting for Computer Scientists
on Tuesday March 08, 2011 @03:49AM (#2300298)
I think the rules may differ in Europe (the way things are classified)
Nope. Sales is NOT a liability, and there is no accounting fiction. Sales are also not an asset. They are an income. The money earned from the sale is the asset. I think you may be confusing ledger credits with liabilities.
All credits are not increases in liabilities, but all increases in liabilities are credits.
Good background on Wikipedia: [ http://en.wikipedia.org/wiki/Debits_and_credits ] [ http://en.wikipedia.org/wiki/Double-entry_accounting_system ] [ http://en.wikipedia.org/wiki/Accounting_equation ]