ANSC 3053 Chapter : Ch 1 Notes
Document Summary
Chapter 1 class notes: identify the forms of business organization and the uses of accounting information, explain the three principal types of business activity, describe the four financial statements and how they are prepared. The purpose of financial information is to provide inputs for decision making. Accounting is the information system that identifies, records, and communicates the economic events of an organization to interested users. Internal reports plan, organize and run a business. Decisions to buy or sell stock or loan company money. Effective financial reporting depends on sound ethical behavior. Financial scandals led congress to the pass the sarbanes- oxley act in 2002. Key provisions: top management must certify accuracy of financial reports, severe penalties for fraud, increased auditor duties. Three types of business activities and examples of each. Resources owned and used by a business (computers, equipment, delivery trucks) Shoe store selling shoes, dentist cleaning teeth, lawn care company mowing lawns.
