The wonderful world of Accounting By: Stephanie Dibble

A little background information Accounting is a system that businesses and individuals rely on to audit their financial statements, provide them with tax preparation and tract the flow of a company’s or corporation’s assets, liabilities and equity over a period of time. There are different types of accountants. Some specialize in auditing, some in taxes, some are titled as CPA’s (certified public accountant) and some are titled CMA’s (certified managerial accountant). All accountants have to follow a system. This system has rules by which accountants operate. This system is called GAAP (Generally Accepted Accounting Principles). These principles are the guidelines for the entire system of accounting. Accountants generally work in the offices of firms, companies, the manufacturing industry and corporations. They often travel to different companies to audit there financial statements. One principle that guides the system of accounting is a basic equation by which all accounts of a company are tracked. This equation includes asset, liability and equity accounts. The equation is as follows:

QUIZ TIME!

Question 1 Accountants only audit the financial statements of a company or corporation. -TrueTrue -FalseFalse Next

Question 2 Accountants can be: -Tax preparersTax preparers - AuditorsAuditors -CPA’sCPA’s -All of the aboveAll of the above Next

Question 3 What does GAAP stand for? -Guidelines for Acceptable Accounting PrinciplesGuidelines for Acceptable Accounting Principles -Guidelines for Applicable Accounting PrinciplesGuidelines for Applicable Accounting Principles -Generally Accepted Accounting PrinciplesGenerally Accepted Accounting Principles -Generally Applicable Accounting PrinciplesGenerally Applicable Accounting Principles Next

Question 4 Accountants generally work in offices for companies and corporations. They also may have to travel a lot. -TrueTrue -FalseFalse Next

Question 5 The basic accounting equation is Assets = Liabilities + Owners Equity. -TrueTrue -FalseFalse Home

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