Chapter 1

Welcome to Accounting 1

Before we dive into the mechanics of accounting, the debits and credits, journal entries and financial statements that will dominate your life this semester, we are going to investigate how financial accounting fits into our culture. I am taking this approach to counter what I consider to be a fundamental flaw with many college level accounting and finance textbooks that focus almost exclusively on financial accounting mechanics and are supplemented with a plethora of glossy photos and irrelevant “feature stories” that provide students little guidance in understanding the context of their academic work. The drawback to this method of teaching accounting is that students learn which buttons to push on their calculator and in what order… without knowing why. Another motivation was to battle with what I consider to be outrageous pricing of textbooks used in American higher education. There is little competition in the accounting textbook market and unsurprisingly, all of the books I reviewed retail for roughly the same price… what a coincidence.