Eli5 What does it mean to ‘balance the books’?
In: 3
A simple way to look at it is what most people should be doing with their bank statements. So you would keep track of what you bought vs money coming into the account. Look at the beginning statement and how much money is in the account, add up all the money that came into the account for a certain period and then subtract money that went out for bills and such. You should have a number that matches the number at the beginning of the next statement. In business, this would have to do with the financials of a company except more involved. You should balance your books to make sure there wasn’t an error and companies balance their books for the same reasons but also to get a state of the business presently and for tax reasons.
Latest Answers