ACC 113 Lecture Notes - Lecture 1: Financial Statement, Financial Accounting, Externals

• School: Tunxis Community College
• Department: Accounting
• Course: ACC 113
• Professor: Muccino

Document Summary

Records, the events in order to provide a history of financial activities. Identifies, the economic events relevant to its business. Communicates, the collected information to interested users by means of accounting reports. In the aggregate: accumulating all sales transactions over a certain period as one amount in the company"s financial statements. Series of activities making understandable and meaningful. Analysis: percentages, ratios, to highlight significant financial trends and relationships. Interpretation: explaining the uses, meaning and limitations of reported data. Accounting process includes the bookkeeping: only the recording of economic events. Two groups of users of financial information: internal users: are managers who plan, organize and run the business. They need detailed information on a timely basis. Managerial accounting: provides internal reports to help users make decisions about their companies. Management, which product line is the most profitable: external users: are individuals and organizations outside a company who want financial information about the company.