Screen Shot 2019-11-08 at 10.10.29 PM.png - Learning objectives o Identify the forms of business organization and the uses of accounting information o

Screen Shot 2019-11-08 at 10.10.29 PM.png - Learning...

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Unformatted text preview: Learning objectives: o Identify the forms of business organization and the uses of accounting information o Explain the three principal types of business activity o Describe the four financial statements and how they are prepared Sole proprietorship O Simple to establish o Owner controlled o Tax advantages Partnership o Simple to establish O Shared control o Broader skills and resources o Tax advantages o Your money is the company's money and visa versa Corporation o Easier to transfer ownership O Easier to raise funds o No personal liability o Pay taxes twice O Your money is NOT company's money and visa versa L.L.P o limited liability partnership Recent financial scandals include: o Enron, WorldCom, HealthSouth, and AIG Congress passed Sarbanes-Oxley Act (SOX) Effective financial reporting depends on the sound ethical behavior Four main financial statement from the summarized accounting data: O Income statement Retained earnings statement O Balance sheet o Statement of cash flow Reports assets and claims to assets at a specific point in time Assets=liability + stockholders equity List assets first then liabilities and stockholders equity The basic techniques for recording business transactions are the same for US and international companies Both international and US accounting standards emphasize transparency in financial reporting. Both sets of standards are primarily driven by meeting the needs of investors and creditors Revenue - Expense= income...
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  • Spring '14
  • BrigidA.Schaffer

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