RSM100Y1 Lecture Notes - Lecture 2: Bookkeeping, Income Statement, Management Accounting
14 Mar 2016
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Document Summary
Accounting is the recording classifying, summarizing and interpreting of financial transactions and events. Investors, suppliers & creditors provides a means to analyze business. Reporting the past vs. assessing what to do in the future. Financial accounting attest function, audit, taxes. Inadequate reserves for bad debts, returns, & liabilities. Changing inventory valuation methods 1 time boost to income. Sales document, purchasing documents, shipping documents, payroll records, bank records, travel records, entertainment records. The effects of these journal entries are transferred or. Income statement, balance sheet, outside reports (for example, annual reports) What the business has, and what it owes. An accounting system is the procedure of organizing, measuring, recording and retaining financial information. Balance sheet = statement of financial position. Income statement = statement of revenues & expenses = statement of comprehensive income. Statement of cash flows = statement of cash receipts & disbursements. Assessment of a firm"s financial condition & performance through calculations & interpretation of financial relationships.
