Introduction
In this Chapter, you will incrementally refine your financial accounting knowledge base by studying the Classified Balance Sheet and Multi-Step Income Statement. If you are not proficient in the base financial accounting rules, mechanics and terminology, then the material presented in this Chapter will be quite confusing. On the other hand, if you have mastered the foundational accounting language and are confident in your ability to analyze basic economic transactions and to complete a full accounting cycle as outlined in Chapters One through Four, you will find this Chapter to be very simple. Since I am writing this book for the best students who want to be challenged, refining a couple of financial statements isn’t enough meat for a full Chapter so I am going to supplement it with the most important (and most interesting and challenging) topic that an accounting student can study. I do not expect you to find easy answers, I want you to embark on an academic journey that begins by asking the question: Is There a Crisis in the Financial Accounting Paradigm?
