They're usable over two years.

Thank you.

So I'll just write down the number first.

Really, in my mind, it's very similar to depreciation.

The price of this book has been reduced by half.

The value of this book has been halved.

Well, you know depreciation, man.

And then at the end of 2010, it'll say the machine is worth nothing.

To figure out the cash from operations from actually how much cash the operations are producing.

So no cash went out of the door.

If you divide 50,000 by 4, it's 12,500.

No, we didn't.

So 20,000 over 3 years is the life of that truck.

So I used half of it in year one.

So therefore, I put it down there.

Our profit, once again, is 30,000.

Thus money in circulation drops, and price escalation quietens down.

And then instead of having an equipment expense, instead of having that expense, they'll have an equipment depreciation expense.

So when you evaluate it at infinity, when you evaluate this at infinity, you're going to get 0.

amortization. Amortization is to spread out a non tangible cost over a period of time.

So for example, depreciation, this was factory equipment, and it gets old as I use it, so I spread out its cost.

So, this becomes... at this price point,

And then their SG amp A is the same.

Also, the price of energy is very important to them.

Accounts Receivable, that they're not changing over the course of the year.

So, for example, in this one, at the beginning of the period, before the 2007 income statement, the asset was worth 50,000.

If we look at unemployment, there are common effects experienced by individuals.

And then the other 250,000 essentially went to an expense called depreciation, which is right there.

This is what's been powering the U.S. economy. It's Moore's Law.

And amortizing really just means spreading out the cost of this asset, just like depreciation was spreading out the cost of a physical asset.

Nothing fancy.

So the way you'd think about this is instead of having factory retooling, you could say factory tool.

Desaturate

Desaturate

Subtraction

Reduce Colors

Reduce To

Inversed Subtract

Subtract

Slowing down.

Slowing down?

Because remember, income statements are just telling you how do you get from one balance sheet to another.

In this year, each of these characters are going to be down by 1 3.

And we'll talk later about depreciation and amortization and how we might change what these values are, but a very simple way is, if you went out and bought 10 million worth of stuff, you'd write on your books, I have a 10 million asset.

Coffee is Uganda's major export.