1. Introduction to Accounting Preparing for a User’s Perspective Introduction to Accounting Preparing for a User’s Perspective www.canvas.net Free Jan. 2014 www.canvas.net Free Jan. 2014 What general types of business exist? Available on the Google Play Store with support from By Kevin C. Kimball, CPA Debits and Credits Trainer

2. Image source: Legalflip.com Ownership Structures LLPs

3. Service Provider ManufacturerWholesaler Retailer End Consumer Hybrid 2 or more of the other types

4. Raw materials Labor Manufacturing Overhead What is a manufacturer?

5. Raw materials Labor Manufacturing Overhead Finished Good

6. Manufacturer Wholesalers Retailer End Consumer

7. Manufacturer End Consumer Retailer

8. Production Costs $.30 Sales Price $1.00 Raw materials $.15 Labor $.05 Mfg Overhead $.10 Gross Margin $.70 - Cost of Goods Sold $.30 = Gross margin $.70 - Operating expenses $.20 = Operating income $.50 Rent Supplies Utilities Admin

9. What is a wholesaler, distributor, middleman? Manufacturers Retailers Wholesalers Distributors Middleman Consumers Wholesale Retailer

10. Wholesale Retailer Consumer Retailer

11. Middleman Manufacturers Retailers Consumers I need to: catch more crab, catch more crab. I need to: buy low, sell high, find more retailers. Question: How is the crab? Sales price $10 - Cost of Goods Sold (4) Gross Margin 6 Answer: It kind of sticks to my tongue.

12. Sales Price $10.00 - Cost of Goods Sold $4.00 = Gross margin $ 6.00 - Operating expenses $5.00 = Operating income $1.00 Salaries, wages, commissions Admin Transportation Communication

13. What is a retailer? Manufacturers Retailers Wholesalers Distributors Middleman Consumers Wholesale Retailer

15. - Cost of Goods Sold Sales Revenue Gross Margin $50 Purchase price of what was sold. Sales price after marked up to retail. Gross margin to cover operations. $150 (100) $50 gross margin / $100 cost of goods sold = 50% Markup on cost

16. Gross Margin $50 Utilities Salaries, Wages, Commissions Rent Advertising Admin Net Operating Income $10

17. What is a service provider?

18. Professional Services Education Healthcare Shipping

19. TIME EXPERTISE

20. How much? $2,015 Hammer $ 15 Where to hit $2,000 Total $2,015

21. We need you to: Work more hours Hire more Work faster smarter

22. I spent the last year fixing dams. Salary expense $80,000. = Gross margin $120,000

23. What is a hybrid business? Includes 2 or more other business types

25. Consumer

26. Service Provider ManufacturerWholesaler Retailer End Consumer Hybrid

27. Introduction to Accounting Preparing for a User’s Perspective Introduction to Accounting Preparing for a User’s Perspective www.canvas.net Free Jan. 2014 www.canvas.net Free Jan. 2014 What general business models exist? Available on the Google Play Store with support from By Kevin C. Kimball, CPA Debits and Credits Trainer