BUS-111 Chapter Notes - Chapter 2: Complementary Good, Management Accounting, Investment
Document Summary
Purpose -> earn profit by selling goods and services: profits generated can create pay raises, reinvested in business, charitable activities. Accounting is used to measure financial performance and to ensure resources are being used efficiently. ** manufacturing firms make products, retail firms sell them *: service businesses, don"t have tangible product for customers, provides intangible benefits (services) (ex) hotels, cab, tax preparers. Provides services to general public (exist at federal, state, and local levels) Purpose is to serve an interest or need in community but also needs financial sustainability (ex) food banks, charities, many universities. Explain why accounting is important to business stakeholders. Stakeholder - relies on financial info to make decisions, since they often have interest in economic viability of an org or business: can be stockholders, creditors, governmental agencies, customers, employees etc. Publicly traded company - stock is traded on stock exchange.
