Chapter 1

The Accounting Game: Lemonade Stand

• The text uses a lemonade stand as a metaphor to learn about accounting.
• The lemonade stand starts with $5 in cash, which is considered an asset.
• The owner also has Notes Payable of $10, representing money borrowed from parents.
• Assets are what a company owns, while liabilities represent what a company owes to others.
• Owner’s Equity represents the owner's share of the business.
• Assets are equal to the sum of Liabilities and Owner's Equity.
• The lemonade stand sells lemonade for $0.50 per glass.
• The cost of producing one glass of lemonade is $0.20.
• The lemonade stand makes a profit of $15 after selling 50 glasses.
• Expenses are costs incurred in running the business, like glass rental, advertising, and rent.
• Expenses are paid out of cash.

Explore fundamental accounting concepts through the fun and interactive lemonade stand game. Learn about assets, liabilities, owner's equity, and expenses as you track the financial health of your lemonade business. Perfect for beginners wanting to grasp essential accounting principles.