Ch1_stu_Sp08

Ch1_stu_Sp08 - ACG2021 Accounting for Decisions Chapter 1-...

Info iconThis preview shows pages 1–14. Sign up to view the full content.

View Full Document Right Arrow Icon
1 ACG2021 Accounting for Decisions Chapter 1- Financial Statements and Business Decisions Yunhao Chen [email protected]
Background image of page 1

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

View Full DocumentRight Arrow Icon
2 What do we hope to learn? What does a business do? How does it go about doing it? What is financial accounting? Who uses it? What are the four basic financial statements? What information do they convey?
Background image of page 2
3 Purpose of a Business Add value to make a profit for owners
Background image of page 3

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

View Full DocumentRight Arrow Icon
4 Simple Model of a Business INPUTS Value  added   conversion OUTPUTS Acquisition/Payment Cycle Sales/Collection Cycle
Background image of page 4
5 How Business Functions Buy land, buildings and equipments Buy materials and supplies Pay employees Pay other expenses To produce and market goods or services (Revenues)
Background image of page 5

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

View Full DocumentRight Arrow Icon
6 How Business Functions To produce and market goods or services (Revenues) Pay a return to owners Pay back loans Pay taxes Growing business
Background image of page 6
7 Types of Businesses Service company (Lawyers, CPAs) provides a service for customers Merchandising business (Walmart, Sam’s Club) Buys goods, then sells them to customers Retail or wholesale Manufacturer (Dell, 3M) Makes the products it sells
Background image of page 7

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

View Full DocumentRight Arrow Icon
8 Ownership Structure of Businesses Sole Proprietorship A single owner business Partnership Two or more owners business Corporation Ownership is divided into "shares" and may be owned by a large number of people
Background image of page 8
9 Corporations Popular form of business because… It’s simple for individuals to purchase small amounts of stock Allows easy transfer of ownership through established exchanges (NYSE, Nasdaq…) Provides limited liability – the most you can lose is your initial investment
Background image of page 9

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

View Full DocumentRight Arrow Icon
10 Separate Legal Entity Since a corporation is a separate legal entity it can: Own assets Incur liabilities Sue and be sued Enter into contracts independent of the stockholder owners
Background image of page 10
11 Who are the Principle Players? Managers (may or may not be owners). Owners (stockholders) are investors. Owners invest money and/or other property in a company for: Short-term investment goals via periodic dividend receipts. Long-term investment goals through stock appreciation. Lenders (creditors). The lenders' goals are also two folds : To earn interest on the loan. To receive debt repayment.
Background image of page 11

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

View Full DocumentRight Arrow Icon
12 Business processes are a series of activities that a company performs to achieve its objectives. Acquisition / Payment : acquire, maintain, and pay for the resources needed by the organization. (INPUTS) Sales / Collections : sell and deliver goods and/or services to customers and to collect payment. (OUTPUTS) Conversion : convert the resources acquired into goods and/or services. (CONVERSION) Business Processes
Background image of page 12
13 Accounting System and its Users Accounting system records and summarizes financial information. Users
Background image of page 13

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

View Full DocumentRight Arrow Icon
Image of page 14
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/07/2008 for the course ENG 2021 taught by Professor Yunhaochen during the Spring '08 term at FIU.

Page1 / 36

Ch1_stu_Sp08 - ACG2021 Accounting for Decisions Chapter 1-...

This preview shows document pages 1 - 14. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online