ACCT 2001 Chapter : Test One Ch 1 4 Outline
Document Summary
Introduction to financial statements: primary forms of business organization. Disadvantages: proprietorship owned by one person, partnership owned by two or more people, simple to establish, owner controlled. Advantages: personally liable financing may be difficult. Investors are they earning satisfactory income?/how do: creditors will they be able to pay debts? they compare in size and profitability, taxing authorities, labor unions, customers, regulatory agencies. Spring 2012: three principal types of business activity shares they purchase expand the business by: *the accounting information system keeps track of the results of each of the three business activities: financing activities get money from outside sources to start and. Issuing shares of common stock: borrowing from creditors: Bonds payable from groups of investors. Accounts payable amounts owed to vendors. Common stock amounts paid by stockholders for. *net income from the income statement is needed to calculate retained earnings. Indicates amounts paid out in dividends and amount of net income or net loss for the period.
