Accounting Made Simple by Mike Piper Summary

Accounting Made Simple is a concise 100-page guide that breaks down core accounting principles like the accounting equation, balance sheets, income statements, and cash flow statements. It also explains financial ratios, GAAP standards, double-entry bookkeeping, and practical topics like depreciation and inventory management, all in plain language without jargon.

This book is ideal for small business owners, entrepreneurs, students, or professionals needing a quick refresher. Its straightforward approach helps anyone grasp financial reporting basics, making it valuable for non-accountants managing budgets or interpreting financial documents.

Yes—it’s praised for distilling complex topics into digestible lessons with real-world examples. Readers gain practical skills like preparing financial statements or calculating liquidity ratios, making it a time-efficient resource for foundational accounting knowledge.

Mike Piper is a CPA (licensed in Colorado) and bestselling author of personal finance guides like Investing Made Simple and Social Security Made Simple. He runs the Oblivious Investor blog and is known for simplifying technical subjects into accessible content.

The book addresses assets vs. liabilities, equity calculations, operating vs. net income, and double-entry bookkeeping. It also clarifies GAAP principles, cash vs. accrual accounting methods, and how to interpret ratios like the current ratio or return on equity.

Piper simplifies ratios like the current ratio (liquidity) and profit margin (profitability) by linking them to real financial statements. Examples show how to calculate and apply these metrics to assess a company’s financial health.

Cash accounting records transactions when money changes hands, while accrual accounting recognizes revenue/expenses when earned/incurred. Piper highlights how each method impacts financial reporting and tax obligations, helping readers choose the right approach for their needs.

The book translates GAAP’s technical rules into plain English, using examples to explain concepts like revenue recognition, matching principles, and consistency standards. This demystifies how businesses maintain compliant financial records.

Yes—it provides step-by-step guidance on creating journal entries using the double-entry system. Piper clarifies how debits and credits affect different accounts, offering practical exercises to reinforce understanding.

It explains inventory valuation methods (e.g., FIFO vs. LIFO) and their impact on COGS calculations. Piper also shows how these figures influence gross profit and balance sheet reporting.

While praised for clarity, some advanced readers may find its 100-page format too brief for complex topics like tax strategies or advanced financial analysis. It’s best suited for foundational learning rather than in-depth study.

Unlike dense textbooks, Piper’s guide prioritizes brevity and accessibility, avoiding excessive detail. It’s ideal for quick learning but pairs well with practice-heavy resources for hands-on application.