Management and Organizational Studies 1023A/B Lecture Notes - Lecture 1: Finance Lease, Fiscal Year, Retained Earnings

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1023A/B
• Professor: Barry Hawn

Document Summary

Chapter 1: purpose and use of financial statements. Accounting = information system that identifies and records the economic events of an organization and communicates then to a wide variety of interested users. Finance directors, marketing managers, human resource personnel, production supervisors and company officers. Use accounting information to make decisions to buy, hold or sell their ownership interest. Use accounting information to evaluate the risks of lending money. Use accounting information to decide whether or not to grant credit (sell on account) to a customer. Use annual reports to learn about the company and evaluate job prospects. Profits are reported as self-employment income and taxed on the owner"s personal income tax return. Requires that the economic activity that can be identified with a particular company be kept separate and distinct from the activities of the owner and of all other economic entities. Hair salons, plumbers, mechanics, farms, small retail stores, etc.