Article Side

Online Article Directory!

Hello Guest! Login or Register to submit articles!

How to accounting: Assets and Liabilities

By Styla Brite Subscribe to RSS | February 29th 2012 | Views:

Knowledge in finance and investing is a must for everyone today. Back in the day, people used to leave the financial jargon to 'those who deal with that kind of thing'. Well, the tide has changed, and it's now absolutely necessary to know where your money is going, your sources of income, and how to balance the two in order to make informed decisions into your financial health. We'll take a look at assets and liabilities, and find out ways of balancing the two for the benefit of you and your family.


To begin with, we'll have a look at what an asset it. This can be defined as anything that has economic value or is expected to provide future benefit if invested in, such as money in the bank, personal property, real estate, and investments. Look around your house or business premises, I'm sure you're bound to see a few. For example, that computer that you use to write short stories for submission in exchange for pay is an asset. That pickup truck that you use to transport items for sale from the warehouse to your supermarket is an asset as well. Make a list of everything you own that is of value. Include your possessions such as vehicles, property, jewelry, furnishings, equipment, antiques and collectibles. Add any investments that you may have, and any cash in the bank. Place a value on each item. When you add up these values, you will have an idea of the worth of your assets. Remember, assets can be converted to cash for times when you'd find yourself in a rough spot.

If you want to acquire additional assets to secure your financial future, you could invest steady investment classes such as stocks, bonds and gold. These can be bought from investment brokers, who will advise you on the best stocks to buy in order to make a profit. It's wise to diversify your assets to bolster your finances from future rainy days that each of us is bound to come into. With a good mix of assets, you can weather the storm and brave economic slumps when they hit.


Next, we'll check out what liabilities are. These are amounts you owe to people or businesses in the form of bills or loans. These also include things that will cost you money in the future like that car loan you're servicing. It's important to make sure that your liabilities never exceed your assets. The funny thing, however, is that sometimes when you're acquiring assets, you incur liabilities. Unless you have cash in the bank to cover their cost, assets are often accompanied by debts. Please note that day-to-day living expenses are not liabilities, as these are costs that are to be expected and should be planned for in advance in your budget.

In order to have an idea of your net worth, add the total cost of your liabilities and subtract it from your assets. This kind of knowledge will give you the power and confidence to take control of your financial future and ensure that you live a worry-free and financially secure life.

Styla Brite - About Author:
Styla Brite is a published author and product reviewer. Continue reading more about How to Accounting and Fundamentals of options.

Share on Facebook Tweet It Stumbleupon this post This post is delicious !

Article Source:

Related Finance Articles Subscribe to RSS

Faulty finance intended to increase values of homes
Published by Sli Dell on March 10th 2012 | Finance
After an allegation of faulty loans on UK banks created a serious problem for them. Specific allegat...
Debtor finance – general considerations
Published by Adair Sawyer on May 11th 2012 | Finance
Many companies find themselves in the impossibility of further developing their business because the...
Personal finance can be fun - Saving money in this tight economy
Published by Sandra Parker on January 23rd 2012 | Finance
In a tight economy it can become hard for you to save money. But, in actuality if you give importanc...
Solve many of your problems in a while through quick finance
Published by John Harry on February 18th 2012 | Finance
Easy finances through financers help an individual to fight with the devils of unexpected expenses. ...
Apply and avail the cash required by you with easy online finance
Published by on March 9th 2012 | Finance
Online finance is the proper platform of getting funds when you are empty handed. So do not think mu...
Quick Text Loans- astonishing opportunity to obtain finance quickly
Published by Calvien Peter on November 30th 2011 | Finance
Quick Text Loans are enormous funds that are availed to candidates on sending an easy text to your a...
Meet all small tasks with ease with short period online finance
Published by Sandra Jeux on March 1st 2012 | Finance
Now don’t bother about urgent cash you need at the time of emergency, apply online with easy short...
Overcome finance related business issues with a reliable insolvency company
Published by Ashish Pandey on January 16th 2012 | Finance
Any business might go through different kinds of hurdles and when things get out of control it is go...
Get easy finance for your new business venture
Published by on January 21st 2012 | Finance
Do you want to start your own business, which requires funds but don't have idea on how to arrange t...
Instant Cash Loans: Immediate finance program
Published by Declan Dylan on January 9th 2012 | Finance
Instant cash loans refer to a variety of immediate finance programs which the British people look fo...
Cash Loans No Credit Check Canada: Alleviation of finance crisis
Published by Lily Jacobs on March 12th 2012 | Finance
Cash loans no credit check Canada are an ideal option available to the salaried people of Canada to ...