This chapter explain the purpose and importance of accounting; Identify users and uses of, and opportunities in, accounting; explain why ethics are crucial to accounting; explain generally accepted accounting principles and define and apply several accounting principles. | Accounting in Business Chapter 1 PowerPoint Editor: Beth Kane, MBA, CPA Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. Chapter 1: Accounting in Business 01-C1: Importance of Accounting 2 Importance of Accounting C1 For example, the sale by Apple of an iPhone. Keep a chronological log of transactions. Prepare reports such as financial statements. 3 Accounting is an information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization’s business activities. Identifying business activities requires that we select relevant transactions and events. Recording business activities requires that we keep a chronological log of transactions and events measured in dollars. Communicating business activities includes preparing accounting reports such as financial statements, which we analyze and interpret. 01-C2: Users of Accounting Information 4 Users of Financial Information C2 Accounting is called the language of business because all organizations set up an accounting information system to communicate data to help people make better decisions. Accounting serves many users who can be divided into two groups: external users and internal users. 5 Accounting is called the language of business because all organizations set up an accounting information system to communicate data to help people make better decisions. Accounting serves many users, who can be divided into two groups: external users and internal users. External users of accounting information are not directly involved in running the organization. They include shareholders (investors), lenders, directors, customers, suppliers, regulators, lawyers, brokers, and the press. External users have limited access to an organization’s information. Yet their business decisions depend on information that is reliable, relevant, and . | Accounting in Business Chapter 1 PowerPoint Editor: Beth Kane, MBA, CPA Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. Chapter 1: Accounting in Business 01-C1: Importance of Accounting 2 Importance of Accounting C1 For example, the sale by Apple of an iPhone. Keep a chronological log of transactions. Prepare reports such as financial statements. 3 Accounting is an information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization’s business activities. Identifying business activities requires that we select relevant transactions and events. Recording business activities requires that we keep a chronological log of transactions and events measured in dollars. Communicating business activities includes preparing accounting reports such as financial statements, which we analyze and interpret. .
