The document discusses the nine key financial metrics, or "numbers", that business owners need to know to understand the health, survival and wealth-building potential of their business. These nine numbers encompass cash flow, income and net worth. They are: 1) Starting Cash 2) Cash In/Out 3) Ending Cash 4) Sales 5) Costs 6) Profit 7) Assets 8) Debts 9) Net Worth. Understanding these numbers allows owners to speak the "language of accounting" and answer important questions about whether the business will survive, is healthy and is making the owner wealthy. The numbers are organized into cash flow statements, income statements and net worth statements.

1. The Nine Numbers
You Need to Know
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2. There is only one number
that ultimately measures
the success of your
enterprise.

3. Builder-Resources.com
Wealth

4. The first step is to break the effort of
WEALTH-BUILDING into the following
three measurable categories:
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However, knowing that you seek wealth
does nothing to help you achieve
wealth.
You need:
•Manageable components
•Metrics
•Systems
•Processes
Wealth

5. The Components of Wealth-Building
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• CASH FLOW is the stream
of money you are able to
generate, from which you
will extract...
• INCOME, which is the
amount of money you can
convert to your use from
the stream of money you
have generated, the excess
of which forms your...
• NET WORTH, which is
comprised of the assets
you own free and clear and
represents your...
• WEALTH.
Wealth
Cash
Flow
Income
Net
Worth

6. Wealth Production Metrics
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Now we have names to use
in defining the wealth-
production process, but..
What are the metrics of
• the Cash Flow system,
• the Income system, and
• the Net Worth system?
They are the
Nine Numbers.
Wealth
Cash
Flow
Income
Net
Worth

7. CASH FLOW
The Cash Flow system is made up of:
Starting Cash +/- Cash In/Out = Ending Cash
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CASH
FLOW
Ending
Cash
Cash
In/Out
Starting
Cash

8. INCOME
The Income system is made up of:
Sales - Costs = Profit
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INCOME
Profit
CostsSales

9. NET WORTH
The Net Worth system is made up of:
Assets = Debts + Net Worth
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NET
WORTH
Net
Worth
DebtsAssets

10. THE NINE NUMBERS
From which are derived…
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THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth

11. THE NINE QUESTIONS
How well do you know your business?
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THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth

12. THE NINE QUESTIONS
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THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
Starting Cash -
how much cash
was in your
account at the
beginning of the
period?

13. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Cash
In/Out - how
much money
came in and/or
went out
during the
period?

14. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Ending
Cash -
how much
cash is in
your bank
accounts
now?

15. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Sales -
how much
business
did you do
during the
period?

16. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Costs - what was
the total cost of
doing business
during the last
period?

17. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Profit - did your
sales exceed your
costs for this
period?

18. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Assets -
what do
you own
right now?

19. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Debts -
what do
you owe
right now?

20. THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth
THE NINE QUESTIONS
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Net Worth -
IS YOUR
BUSINESS
MAKING YOU
WEALTHY?

21. The Nine Numbers & Nine Questions
1. Starting Cash – how much cash
was in your account at the beginning
of the period?
2. Cash In/Out - how much money
came in and/or went out during the
period?
3. Ending Cash - how much cash is
in your bank accounts now?
4. Sales - how much business did
you do during the period?
5. Costs - what was the total cost of
doing business during the last
period?
6. Profit - did your sales exceed
your costs for this period?
7. Assets - what do you own now?
8. Debts - what do you owe now?
9. Net Worth - Is your business
making you WEALTHY?
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Can you answer the questions tied
to each of the numbers?
THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth

22. The Nine Numbers
If you know the answers to most of
those questions, you have a basic
understanding of the financial
systems of your business.
You just need a structure to put the
numbers into so they make sense.
That structure, that system, is
Accounting.
Accounting is the
language that
business uses to talk
about money.
Just like we structure our sentences
and paragraphs to speak in a
language, we structure the Nine
Numbers in a specific way to speak
the language of accounting.
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THE NINE
NUMBERS
Starting
Cash
Cash
In/Out
Ending
Cash
Sales
CostsProfit
Assets
Debts
Net
Worth

23. The Nine Numbers® -
Speaking the Language of Accounting
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The "Nine Numbers"
encapsulate all the important
financial information you need
to know about your business.
They are the basic
components of:
•your Cash Flow Statement
the checkbook
•your Income Statement
the shoebox depository
•Your Net Worth Statement
the financial snapshot
Start
Cash
Cash
In/Out
End
Cash
Sales Costs Profit
Assets Debts
Net
Worth
Cash Flow Statement
Income Statement
Net Worth Statement

24. Cash Flow Statement
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Starting Cash
- Comes from the asset section of
the Net Worth Statement.
Cash In/Out (Transactions)
- Are, for the most part, your cash
sales and cash expenses for the
period.
- Could also include the
-down-payment on a pickup,
-the purchase for cash of an
expensive tool, or
-short-term money borrowed
for operations.
Ending Cash
- What is left in your checking
account at the end of the period.
- Balance is recorded in the asset
portion of the Net Worth Statement.
Start
Cash
Cash
In/Out
End
Cash
Sales Costs Profit
Assets Debts
Net
Worth
Cash Flow Statement
Income Statement
Net Worth Statement

25. Sample Cash Flow Statements
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View the Cash
Flow Statement in
"Checkbook"
format
View the Cash
Flow Statement in
"Category"
format
Download the
Interactive Cash
Flow Statements
(Click to View or Download)

26. Income Statement
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Sales contribute to the
- Cash-in on the Cash Flow Statement,
or
- Accounts Receivable on the Net
Worth Statement.
Costs paid in cash show up in
- Cash-out section of the Cash Flow
Statement.
- Cost for materials, subcontractors,
utilities , etc bought but not paid for go
into Accounts Payable on the Net
Worth Statement.
Profit
- Is NOT CASH. You do not get to spend
Profit.
- Is the difference between Sales and
Costs.
- Shows up in the Income Statement
- Is recorded in the Accrued Earnings
section of the Net Worth Statement.
Start
Cash
Cash
In/Out
End
Cash
Sales Costs Profit
Assets Debts
Net
Worth
Cash Flow Statement
Income Statement
Net Worth Statement

27. Net Worth Statement
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Assets are what the business owns
- Cash,
-Money owed by customers,
-Equipment, buildings, and land.
Liabilities are what the business owes,
- Materials purchased on account,
- Subcontractor billings unpaid, and
- Money borrowed for equipment,
buildings and land.
Net Worth is the wealth of the
business.
- Your wealth.
- Report card of how well you are doing.
- Assets minus Liabilities,
- Includes the accrued Profits from this
and previous periods.
- Positive number = You are doing well.
- Negative number = fix the problem.
Start
Cash
Cash
In/Out
End
Cash
Sales Costs Profit
Assets Debts
Net
Worth
Cash Flow Statement
Income Statement
Net Worth Statement

28. The Nine Numbers® -
Answering Three Important Questions.
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Start
Cash
Cash
In/Out
End
Cash
Is the business going to SURVIVE?

29. The Nine Numbers® -
Answering Three Important Questions.
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Is the business HEALTHY?
Sales Costs Profit

30. The Nine Numbers® -
Answering Three Important Questions.
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Is the business making me WEALTHY?
Assets Debts
Net
Worth

31. Would you like to see more about this topic?
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