1-1 CHAPTER 1 INTRODUCTION TO ACCOUNTING

1-2 LEARNING OBJECTIVE 1 DESCRIBE THE PURPOSE OF ACCOUNTING.

1-3 THE PURPOSE OF ACCOUNTING  FINANCIAL INFORMATION ABOUT THE CURRENT OPERATIONS AND FINANCIAL CONDITION OF A BUSINESS TO INDIVIDUALS AND ORGANIZATIONS  Keep track of and present financial info $$$$$$$$ TO PROVIDE:

1-4 WHO ARE THE USERS OF ACCOUNTING INFORMATION?  Anyone who cares about keeping track of $

1-5 LEARNING OBJECTIVE 2 DESCRIBE THE ACCOUNTING PROCESS.

1-6 THE ACCOUNTING PROCESS  GATHERING FINANCIAL INFORMATION ABOUT A BUSINESS AND REPORTING THIS INFORMATION TO USERS ACCOUNTING IS A SYSTEM OF:

1-7 STEP ONE ANALYZING LOOKING AT EVENTS THAT HAVE TAKEN PLACE AND THINKING ABOUT HOW THEY AFFECT THE BUSINESS

1-8 STEP TWO ENTERING FINANCIAL INFORMATION ABOUT EVENTS INTO THE ACCOUNTING SYSTEM RECORDING

1-9 STEP THREE SORTING AND GROUPING SIMILAR ITEMS TOGETHER RATHER THAN MERELY KEEPING A SIMPLE, DIARY- LIKE RECORD OF NUMEROUS EVENTS CLASSIFYING

1-10 STEP FOUR THE AGGREGATION OF MANY SIMILAR EVENTS TO PROVIDE INFORMATION THAT IS EASY TO UNDERSTAND SUMMARIZING

1-11 STEP FIVE TELLING THE RESULTS REPORTING

1-12 STEP SIX DECIDING THE MEANING AND IMPORTANCE OF THE INFORMATION IN VARIOUS REPORTS INTERPRETING

1-13 THE ACCOUNTING PROCESS: SIX MAJOR STEPS ANALYZINGRECORDING

1-14 THE ACCOUNTING PROCESS: SIX MAJOR STEPS SUMMARIZINGCLASSIFYING

1-15 REPORTINGINTERPRETING THE ACCOUNTING PROCESS: SIX MAJOR STEPS

1-16 LEARNING OBJECTIVE 3 DEFINE GAAP AND DESCRIBE THE PROCESS USED BY FASB TO DEVELOP THESE PRINCIPLES.

1-17 GAAP  GENERALLY ACCEPTED ACCOUNTING PRINCIPLES  DEVELOPED BY THE FINANCIAL ACCOUNTING STANDARDS BOARD (FASB)  PROCEDURES AND GUIDELINES TO BE FOLLOWED IN THE ACCOUNTING AND REPORTING PROCESS

1-18 LEARNING OBJECTIVE 4 DEFINE THREE TYPES OF BUSINESS OWNERSHIP STRUCTURES.

1-19 THREE TYPES OF OWNERSHIP STRUCTURES  SOLE PROPRIETORSHIP  PARTNERSHIP  CORPORATION

1-20 SOLE PROPRIETORSHIP  ONE OWNER  OWNER ASSUMES ALL RISK  OWNER MAKES ALL DECISIONS

1-21 PARTNERSHIP  TWO OR MORE PARTNERS  PARTNERS SHARE RISKS  PARTNERS MAY DISAGREE ON HOW TO RUN THE BUSINESS

1-22 CORPORATION  STOCKHOLDERS  STOCKHOLDERS HAVE LIMITED RISK  STOCKHOLDERS MAY HAVE LITTLE INFLUENCE ON BUSINESS DECISIONS  guide/forming-corporation-california guide/forming-corporation-california

1-23 LEARNING OBJECTIVE 5 CLASSIFY DIFFERENT TYPES OF BUSINESSES BY ACTIVITIES.

1-24 TYPES OF BUSINESSES  SERVICE BUSINESS  MERCHANDISING BUSINESS  MANUFACTURING BUSINESS

1-25 SERVICE BUSINESS A BUSINESS THAT PROVIDES A SERVICE TRAVEL AGENCY COMPUTER CONSULTANT PHYSICIAN

1-26 MERCHANDISING BUSINESS A BUSINESS THAT BUYS A PRODUCT FROM ANOTHER BUSINESS TO SELL TO CUSTOMERS DEPARTMENT STORE PHARMACY JEWELRY STORE

1-27 MANUFACTURING BUSINESS A BUSINESS THAT MAKES A PRODUCT TO SELL AUTOMOBILE MANUFACTURER FURNITURE MAKER TOY FACTORY