b10chap17 - 12/6/2011 1 Chapter 17: Understanding...

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Unformatted text preview: 12/6/2011 1 Chapter 17: Understanding Accounting and Financial Information The recording, classifying, summarizing, and interpreting of financial events and transactions to provide management and other interested parties the information they need to make good decisions. 15-2 The recording, classifying, summarizing, and interpreting of the financial dimension of business transactions to provide management and other interested parties the information they need to make good decisions. 15-3 12/6/2011 2 17-4 12/6/2011 3 True or False? Churches, schools, and charitable organizations all hire accountants. True or False? The accounting profession is divided into two main fields: bookkeeping and auditing. 12/6/2011 4 • Managerial • Financial • Auditing • Tax accounting • Governmental and not-for- profit accounting 15-10 “Accounting used to provide information and analyses to managers within the organization to assist them in decision making.” Can answer questions like: 1. How much money did we make in each sales region? 2. Should we trim back our sales force in the sales regions that are less profitable? 12/6/2011 5 Can also answer questions like: 3. How much money did we make on each of our product lines? 4. To which product lines should we allocate our limited research and advertising budgets? 5. Which of our factories are the most efficient? “Accounting information and analyses prepared for people outside the organization.” Example: Companies’ Annual Reports • Certified Public Accountants (CPAs) -- Accountants who have passed a series of examinations established by the American Institute of Certified Public Accountants (AICPA) and met a states requirements for education and experience. • Certified Management Accountants (CMAs) -- Accountants who have passed a series of examinations established by the Institute of Management Accountants (IMA) and met an education and experience requirement. 17-15 12/6/2011 6 Private accountants: Accountants who work for a single manufacturing or service company fulltime, and perform work only for that company. Public accountants: Accountants who work for a firm that sells accounting services to other companies (requires a C.P.A.) “The job of reviewing and evaluating the records used to prepare a company’s financial statements.” ¡ Independent audit ¡ Internal audit The job of preparing tax returns and/or developing tax strategies for a company....
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This note was uploaded on 01/11/2012 for the course BUSINESS 10 section taught by Professor Byronlilly during the Winter '12 term at DeAnza College.

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b10chap17 - 12/6/2011 1 Chapter 17: Understanding...

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