3311Ch01 - Sommers ACCT3311 SMUCox...

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Sommers–ACCT 3311 SMU Cox 1 ACCT 3311: Intermediate Accounting I Greg Sommers, PhD CPA Click to edit Master title style Click to edit Master subtitle style gsommers@smu.edu http://gsommers.cox.smu.edu/acct3311/ Spring 2011 Internship Program Key dates for fall General information session Tuesday September 21 st , Georges Auditorium, 5:00 p.m. (casual attire) Big 4 audit and tax internship panel discussion Tuesday November 9 th , E&Y Gallery, 5:00 p.m. (business casual attire) Other firms panel discussion Wednesday November 10 th , E&Y Gallery, 5:00 p.m. (business casual attire)
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Sommers–ACCT 3311 SMU Cox 2 CHAPTER 1 ENVIRONMENT AND THEORETICAL STRUCTURE OF FINANCIAL ACCOUNTING Overview The primary function of financial accounting is to provide relevant and reliable financial information to users external to the business. These users make critical resource allocation decisions that affect the nation’s economy. The primary means of conveying financia The primary means of conveying financial information to external users is through financial statements and related notes.
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Sommers–ACCT 3311 SMU Cox 3 Financial Accounting Environment Providers of Financial Information External User Groups Profit oriented companies Not for profit Investors Creditors Employees Labor unions Customers Relevant entities Households Suppliers Government agencies Financial intermediaries Financial Information Financial Accounting Environment Relevant financial information is provided primarily through financial statements and related disclosure notes. Balance Sheet Income Statement Statement of Cash Flows Statement of Shareholders’ Equity
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Sommers–ACCT 3311 SMU Cox 4 The Economic Environment and Financial Reporting A sole proprietorship is owned by a A highly-developed system of financial single individual. A partnership is owned by two or more individuals. system of financial reporting is necessary to communicate financial information from a corporation to its many shareholders. A corporation is owned by stockholders. Investment Credit Decisions A Cash Flow Perspective Shareholders Creditors Receive Cash 1. Dividends 2. Sale of Stock Receive Cash 1. Interest 2. Loan Repayment Accounting information should help investors evaluate the amount , timing , and uncertainty of the enterprise’s future cash flows.
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This note was uploaded on 09/30/2010 for the course ACCT 3311 taught by Professor Gregsommers during the Fall '10 term at Southern Methodist.

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3311Ch01 - Sommers ACCT3311 SMUCox...

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