COMMERCE 1AA3 Chapter Notes - Chapter 1: International Financial Reporting Standards, International Accounting Standards Board, Telus
2 Jul 2015
School
Department
Course
Professor
Document Summary
Objective 1: explain why accounting is the language of business. A. accounting is an information system that measures business activities, processes data into reports, and reports results to decision makers. Exhibit 1-1 illustrates the flow of information in an accounting system. D. types of business organizations (summarized in exhibit 1-2): proprietorship an unincorporated business with a single owner. The owner has unlimited liability which means that the owner assumes personal responsibility for the debts of the business: partnership an unincorporated business with two or more owners. Each partner has unlimited liability: corporation an incorporated business owned by shareholders whose ownership is evidenced by the number of shares held. Shareholders elect the members of the board of directors, which sets policy for the corporation and appoints officers. A corporation is distinct from its owners and has many of the rights entitled to a person. Objective 2: explain accounting"s conceptual framework and underlying assumptions.
