201Lec01 - 201Lec01.PPT Introduction to Financial...

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201Lec01.PPT C H U K O N L f i c e : B  N  3 2 8 h o u r s M , W 3 0   -  5 T / A D J  A n a , K l y         K  J m S b w t  o d . Introduction to Financial Accounting BUS ADM-201 1
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DEFINITION OF ACCOUNTING DEFINITION OF ACCOUNTING Accounting is a process used to record economic (business) activities of an organization in order to generate reports for use by decision makers. Accounting is a process used to record economic (business) activities of an organization in order to generate reports for use by decision makers . 2
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Process - Systematic - Uniform method - Assemble, aggregate and analyze huge volumes of data Related disciplines: - Management (Accounting) Info  Systems  (AIS or MIS) - Industrial Engineering  Process - Systematic - Uniform method - Assemble, aggregate and analyze huge volumes of data Related disciplines: - Management (Accounting) Info  Systems  (AIS or MIS) - Industrial Engineering  3
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Process - Objective. Many rules. Rules are created by the F Financial A Accounting S Standards B Board ( FASB FASB). Rules are called GAAP GAAP. (Generally A Accepted A Accounting P Principles) Publicly traded companies are also ruled by the S Securities and E Exchange C Commission ( SEC SEC). Process - Objective. Many rules. Rules are created by the F F inancial A A ccounting S S tandards B B oard ( FASB FASB ). Rules are called GAAP GAAP . ( G enerally A A ccepted A A ccounting P P rinciples) Publicly traded companies are also ruled by the S S ecurities and E E xchange C C ommission ( SEC SEC ). 4
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1-  1-  Financing Activities Financing Activities Borrowing creates Borrowing creates liabilities liabilities (debts) Notes payable Notes payable Accounts payable Accounts payable Issuing or Selling stock Issuing or Selling stock creates  creates  stockholders’ stockholders’ equity equity Business Activities - 3 types - 3 types Business Activities - 3 types - 3 types 5
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2 -  2 -  Investing Activities Investing Activities Obtaining resources or  Obtaining resources or  assets assets  to operate the   to operate the  business business Cash Cash Inventory Inventory Accounts receivable Accounts receivable Buildings Buildings Equipment, etc Equipment, etc Business Activities - 3 types - 3 types Business Activities - 3 types - 3 types 6
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Primary way business Primary way business makes money makes money 7 Business Activities - 3 types
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201Lec01 - 201Lec01.PPT Introduction to Financial...

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