{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

chapter 1 ntoes - I Importance of accounting A Accounting...

Info icon This preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
I. Importance of accounting A. Accounting is... 1. Providing information about what businesses owe and how they preform 2. Identifying, recording, and communicating relevant, reliable and comparable information about an organization's business activities a) Identifying: finding relevant business transactions b) Recording: logging transactions c) Communicating: preparing reports and financial statements as well as analyzing and interpreting such reports 3. The language of business 4. Roles of accounting have changed as technology has changed a) Expanded the role of accounting B. Users of accounting information 1. External information users: not directly involved with running the organization a) Financial accounting serves external users with general-purpose financial statements * Creditors loan money; use statements to determine how likely an organization is to repay its loans * Shareholders own a corporation; use statements to decide whether to buy, hold or sell stock * External auditors examine financial statements to verify that financial statements adhere to the generally accepted accounting principles * Regulators have legal authority over certain activities of organizations * Suppliers use statements to judge the soundness of a costumer before making sales on credit * Costumers use financial statements to assess the staying power of potential suppliers 2. Internal information users: manage and operate an organization to improve efficiency and effectiveness a) Monitor and control company activities by protecting property and ensuring efficiency and reliability b) Managerial accounting serves the decision making needs of internal users * Research and development managers use statements to project costs and
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
revenues * Purchasing managers use statements to decide how much of what supply to purchase * Human resource managers use statements to determine worker's compensation * Production managers monitor costs and ensure quality C. Opportunities in accounting 1. Certified public accountant (CPA)
Image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern