Chpt1 Introduction

for preparing financial statements income statement

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Unformatted text preview: .) for preparing financial statements (income statement, balance sheet, and statement of cash flows) • Mandatory for publicly traded firms • GAAP determines the content and format • Primarily uses historical data • Prepared mainly for external parties such as potential investors, shareholders, and banks Managerial Managerial Accounting • Collection of financial data with primary emphasis on product cost data (cost of materials, labor, machinery and equipment, rent on factory building, etc.) bu • Not mandatory (except when calculating the cost of goods sold and ending inventory for financial reporting purposes) – firms can produce the information only if having the information is worth the c...
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