Issue #48 2/10 Net 30 & The Math Of Paying Early Happy Monday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about 2/10 net 30, the early payment discount printed on millions of vendor invoices. Tomas Becker runs Redline Collision, a 9-bay auto body shop in Sacramento, and he buys about $42,000 a month in paint, clear coat, and replacement parts on...
5 days ago • 6 min read
Issue #47 Trial Balance Errors Your Totals Won't Catch Happy Friday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about the trial balance, the report that proves your debits equal your credits and very little else. Marisol Ortega runs Brightline Electric, a 12-person commercial electrical contractor in Spokane, and her trial balance matched to the...
8 days ago • 6 min read
Issue #46 Days Sales Outstanding and the $112,000 wait Happy Monday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about days sales outstanding, the number that tells you how long customers take to pay you. Marisol Ortega runs a commercial cleaning company in Raleigh, North Carolina, and $112,000 of her cash was sitting in her customers' bank...
12 days ago • 6 min read
Issue #45 Free Cash Flow and The $240,000 That Wasn't Cash Happy Friday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about free cash flow, the cash a business has left after paying to keep itself running. Hollis Grant runs an aerial drone survey company in Tucson, Arizona, and her 2025 income statement showed $240,000 of net income. When an...
15 days ago • 5 min read
Issue #44 Interest Coverage Ratio And The 1.9x Warning Happy Friday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about the interest coverage ratio, one division problem that shows whether a business can afford its own loans. Darnell Hughes runs a wholesale greenhouse in Lancaster County, Pennsylvania, and his interest coverage slid from 4.2x to...
19 days ago • 6 min read
Issue #43 Return On Equity and What $800,000 Really Earned Happy Friday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about return on equity, the measure that shows what each dollar of ownership actually earns. Natalie Okafor runs a dog daycare and boarding business in Madison, Wisconsin, and $800,000 of her equity was producing $56,000 a year, a 7%...
22 days ago • 6 min read
Issue #42 Chart of Accounts and The $78,000 Blind Spot Happy Monday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. In today's issue, we talk about the chart of accounts. It is the list of categories every transaction in your books gets sorted into. Owen Pratt runs a pool service and repair company in Sacramento, California, and his reports said the repair side of the...
26 days ago • 5 min read
Issue #41 Owner's Draw vs. Salary and a $34,500 Tax Bill Happy Friday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about owner's draw vs. salary, the two ways a founder moves money from the business to themselves. Imani Brooks runs a UX design studio in Pittsburgh, Pennsylvania, and she paid herself $96,000 in owner's draws last year, believing...
29 days ago • 5 min read
Issue #40 Month-end Close and the $28,600 July Mistake Happy Tuesday, Welcome back to Balance Sheet. Every issue follows one real business with a problem hiding in its numbers, walks through what went wrong on the books, and shows you the fix. Today's issue is about the month-end close, the routine that turns a month of transactions into numbers you can trust. Jonah Whitaker runs an event rental company in Richmond, Virginia, and his July P&L showed $38,000 of net income that was really...
about 1 month ago • 6 min read