1. Chapter 1 – Part 1

2. Define accounting vocabulary

3. 1. Measures business activity 2. Processes data into reports 3. Communicates results to decision makers 3Copyright (c) 2009 Prentice Hall. All rights reserved.

4.  End product of accounting process  Report on business in monetary terms 4Copyright (c) 2009 Prentice Hall. All rights reserved.

5. Define the users of financial information

6. 6 Accounting — An Information Process Accounting — An Information Process Identification of Users

7. 7 EXTERNAL USERS Financial Accounting investors creditors regulators customers competitors  owners  managers  employees INTERNAL USERS Managerial Accounting Users of Accounting Information

8. 8 User Information Needs Accounting — An Information Process Accounting — An Information Process Identification of Users

9. 9 Identification of Users User Information Needs Accounting System Accounting — An Information Process Accounting — An Information Process

10. 10 Identification of Users User Information Needs Accounting System Economic Data and Activities Accounting — An Information Process Accounting — An Information Process

11. 11 Identification of Users User Information Needs Accounting System Economic Data and Activities Reports Accounting — An Information Process Accounting — An Information Process

12. 12 Identification of Users User Information Needs Accounting System Reports Economic Data and Activities User Decisions Accounting — An Information Process Accounting — An Information Process

13. IndividualsBusinessesInvestors Creditors Taxing Authorities 13Copyright (c) 2009 Prentice Hall. All rights reserved.

14. Financial Accounting  Provides information for external decision makers ◦ Investors ◦ Creditors ◦ Taxing authorities Managerial Accounting  Provides information for internal decision makers ◦ Managers ◦ Individual business owners 14Copyright (c) 2009 Prentice Hall. All rights reserved.

15. Describe the accounting profession and the organizations that govern it

16.  Lucrative career with many opportunities  Certified Public Accountants (CPAs) ◦ Pass qualifying exam ◦ Meet education and/or experience requirements 16 Public Accounting – CPA Firms Private Accounting – Business & Other Organizations Copyright (c) 2009 Prentice Hall. All rights reserved.

17. 17 EXTERNAL USERS Financial Accounting investors creditors regulators customers competitors Users of Accounting Information

18. 18  Generally Accepted Accounting Principles - established rules, principles, and concepts  Formulated by Financial Accounting Standards Board (FASB)

19. Financial Accounting Standards Board Private organization that makes accounting standards FASB 19Copyright (c) 2009 Prentice Hall. All rights reserved.

20. Identify the different types of business organizations

21. ProprietorshipsPartnerships Corporations Limited Liability Companies 21Copyright (c) 2009 Prentice Hall. All rights reserved.