Suppose you graduate from college with good grades and a degree in some field that would allow you to easily find a job paying $90,000 for the first year. Sounds good doesn't it? Suppose instead of taking the job you decide to start your own business.

At the end of the first year of running your business you add up all the revenue, subtract all your direct expenses of doing business (depending on the sort of business, these might include: labor, materials, rent, transportation, utilities, advertising, insurance.. etc. you get the idea) and the difference is what most people would call profit. Let's say that these expenses listed above amount to $120,000 and your first year's revenue came to $180,000. $180,000 - $120,000 = $60,000. A good first year by all accounts, a profitable first year apparently, but not really...

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