Chapter 1: Introduction to AccountingAccounting:Process of recording, analyzing, summarizing and reporting. Recording – journalsAnalyzing – ledgerSummarizing – trial balanceReporting – balance sheet, income statement, statement of retained earnings, statement of cash flow Accounting Guideline– GAAP – Generally Accepted Accounting Principles3 Types of Businesses: 1.Service Business – provide service rather than products to customers (external)2.Merchandising Business – sells products purchased from other businesses to customers (external)3.Manufacturing Business – change basic inputs to products that are sold to customers (internal) 2 Types of Accountants: 1.Public – must have a license issued by the state. Certify documents that are free of error (financial audits)2.Private – any accountant, degree/no degree. Example: managerial accounting, more for internal use. Managerial Accounting: (internal) accounting that deals with information designed to meet specific needs of a company’s management. Financial Accounting: (external) accounting that is concerned with recording transactions using GAAP for a business or other economic unit and with a periodic preparation of various statements from records – send out reports.