Expert: Ed McFarland - 12/18/2005

Question
Hi Ed,

I know my question is going to seem very trivial, but I am really looking for some guidance here.

Basically I'm reading a book on basic accounting/bookkeeping and was reading about owners equity. This may seem like a silly question but is it always desirable for an owner to get all of their money invested back from the business? Is this always the perfect scenario eventually?

Also, do you know of any accounting forums where people such as myself can ask silly questions to their hearts content.

Thanks

Adrian

Answer
The owners and investors are synonyms. They receive their return only after all other stakeholders get theirs.

If you think of it as a line up the owners are last to get paid. If their pile is huge it is the reward for getting it right. If they don't, it is bankruptcy.

I'm not aware any groups, but try googling for one I'm sure they are out there.

Good luck.