Accounting Dictionary

24 Part 1 Fi~ncia!Accmrnting

used grinding machine but had to buy a second one Zimrner, Zimmer promised to create files to new; supplies and parts necessary to run and maintain date accounting and nonaccounting information that Fuller could access through the company's pemml the machines also were purchased. Fuller also purcomputer. As Fuller's first lesson in accounting, Zimmer chased a personal computer with the intention of using gave Fuller a brief lecture on the nature of the balance it to keep company records. These items used $65,000 sheet and income statement and suggested Fuller draw of the $75,000 Fuller had saved and invested in the company. up an opening balance sheet for the company. Confident now that the venture was starting on A warehouse costing $162,000 was found in an excellent location for the business. Fuller was able to intersolid ground, Kim Fuller opened the warehouse, signed contracts with two local bottling companies, est family members enough in this project that three of and hired two grinding machine workers and a truck them---two sisters and a brother-invested $30,000 im driver. By February 201 1 the new fr was making each. These funds gave Fuller the $50,000 down payregular deliveries to Fuller's former employer. ment on the warehouse. The bank approved a mortgage for the balance on the building. In granting the mortQuestions gage, hbever, the bank official suggested that Fuller start from the beginning with proper accountingrecords. He said thesk,records would help not only with future 1. What information will Fuller need to manage the bank dealings Gut also with tax returns and general manbusiness? Classify this information in two cate agement of the company. He suggested Fuller lind a gories: accounting information and nonaccounting good accountant to provide assistance from the start, to information. get things going on the right foot. 2. See what you can do to draw up a beginning-ofFuller's neighbor, Marion Zimmer, was an...