Alibaba Arithmetic

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Jack Ma of the Alibaba.com gives this Arithmetic question to the audience,  only 1% get the answer right !

Jack has cash $50, which he uses to buy:
Clothing : $20 (Balance $50-20 = $30)
Shoes: $15 (Balance = $30-15 = $15)
Candy: $9 (Balance = $15- 9 = $6)
Food: $6 (Balance = $6 – 6=$0)

Question:
Add up the Balances = $ 30+15+6 = $51

Where does the extra $1 come from ?

No excuse for Accountants to get it wrong !!!☺

[Answer: Scroll down below at last page….]

On a more serious Accounting topic. There was a Management Conference orgainsed by the Chairman of a big MNC, during the first day he asked the Human Resource Director to emphasise that employees are valuable Assets of the company, and the second day the Finance Director on the importance of keeping a healthy Balance Sheet.

A Sales Manager, fed-up of the recent massive employees lay-off, raised a question to the Chairman on the 3rd day during the Q&A session:

“Mr. Chairman, we learn from HR that employees are valuable Assets, why aren’t they appeared on the Finance Balance Sheet ?”

There was an uproar clapping of hands and laughters in the hall.

Both HR and Finance directors were embarrassed by the question. The enraged Chairman took the microphone,

“Very simple answer! To me, those employees who contribute to the bottom-lines are Assets, those who don’t are the Liabilities!”

All the managers kept silence, in their mind they started to draft their C.V.

Answer of Alibaba Arithmetic: (If you don’t know the answer, please revise your Accounting….Scroll down below)
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In Accounting rule: Debit = Credit
Credit Cash = $50
Debit Expenses = $ 20 + 15 + 9 +6 =$50
No meaning to add Balances. If my first 2 transactions were $1, $1, the Balance would be $49, then $48, add them up = $ 49 + $48= $97 > $50. Absurd!

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