Zion Oil & Gas Inc (ZNOG)

[Moses1492]

Basic accounting principle 101: Assets = Liabilities + Owners Equity

So if ZN raises 45 million in cash and they invest a large portion of it into physical assets like drilling pump jacks, pumping stations, BIG boy
25K ft drilling rigs, etc etc... these purchases are not "expenses" as they are physical "assets" that will continue to have market value over a long lifespan (and gradually expenses over their useful life less salvage value). On the asset side of the accounting equation the cash account with 50 million will be reduced while on the same side of the asset column the actual newly acquired physical assets will be inventoried as assets - its a wash on the asset side of the books.

Additionally ZN share value will remain unchanged for all assets $purchased - it will be a wash.

Consider share value with $100 in assets and 10 open shares = $10 net share equity value / with a capital rights offering raise now we will have $200 and 20 open shares but still worth $10 share.