Chapter 1 Introducing Financial Accounting QUESTIONS 1. The purpose of accounting is to provide decision makers with relevant and reliable information to help them make better decisions. Examples include information for people making investments, loans, and business plans. 2. Technology reduces the time, effort, and cost of recordkeeping. There is still a demand for people who can design accounting systems, supervise their operation, analyze complex transactions, and interpret reports
Words: 6481 - Pages: 26
While financial management deals with a wide array of decisions, we can group them in three main areas: investing, financing, and working capital. Every decision we take in the context of financial management will have to include these three aspects. Let’s consider the following real-life scenario: Last year, Boeing announced its decision to open a new $750 million manufacturing plant in South Carolina. This decision required Boeing to assess the potential investment return on the project and
Words: 1609 - Pages: 7
Financial controls Which accounting system? Reserves Budgeting Cash flow Book keeping Petty cash Bank reconciliation Finance reports Annual accounts Glossary Financial controls are the written rules and procedures for financial control and management that all organizations should have. Financial controls should cover, for example, who can sign cheques, who maintains the cash books, and how petty cash is administered. Some of these rules will be laid down by the constitution
Words: 1713 - Pages: 7
that will produce and sell finished tennis balls. In the language of finance, you make an investment in assets such as inventory, machinery, land, and labor. The amount of cash you invest in assets must be matched by an equal amount of cash raised by financing. When you begin to sell tennis balls, your firm will generate cash. This is the basis of value creation. The purpose of the firm is to create value for
Words: 7653 - Pages: 31
Financial Statements Paper Part I Student ACC 497 8.17.2015 Professor Financial Statement Paper Part I: Home Depot For employees, creditors, and investors, financial statements are essential. They provide insight and information regarding a company’s overall performance. The Securities and Exchange Commission (SEC) requires that all publicly traded companies release their financial statements on a regular basis – quarterly and annually. The annual report consists of three main reports:
Words: 1224 - Pages: 5
We use this principle to project cash flows in the future. 2. Legal Entity: The business is an entity separate from owners; even if it’s a small, one person business running out of home. Therefore the business accounts are taken separate from the owners. 3. Conservatism: Be cautious and conservative while accounting. Recognize income only when it’s definite. 4. Accrual Concept: Income and expense are recognized/recorded when a transaction occurs- not when cash changes hands. Income and expense
Words: 2036 - Pages: 9
Interview Questions This page is here to help us all be prepared for the types of questions that are typically asked during an interview. We have tried to break them down into the categories listed below as best as possible. Personal Questions - Finance Questions - Accounting Questions - Other Questions [pic] Personal Questions Q. Spend 5 minutes and walk me through your resume. A. The first question you will most likely be asked. On the surface it seems like an easy question, but you will
Words: 3974 - Pages: 16
Chapter 1 Financial Statements and Business Decisions ANSWERS TO QUESTIONS 1. Accounting is a system that collects and processes (analyzes, measures, and records) financial information about an organization and reports that information to decision makers. 2. Financial accounting involves preparation of the four basic financial statements and related disclosures for external decision makers. Managerial accounting involves the preparation of detailed plans, budgets, forecasts, and performance
Words: 5852 - Pages: 24
1. Introduction: Financial accountancy (or financial accounting) is the field of accountancy concerned with the preparation of financial statements for decision makers, such as stockholders, suppliers, banks, employees, government agencies, owners and other stakeholders. Financial capital maintenance can be measured in either nominal monetary units or units of constant purchasing power. The central need for financial accounting is to reduce the various principal-agent problems, by measuring and
Words: 7845 - Pages: 32
Relevant cash flows Answer: d Diff: E . Which of the following statements is most correct? a. The rate of depreciation will often affect operating cash flows, even though depreciation is not a cash expense. b. Corporations should fully account for sunk costs when making investment decisions. c. Corporations should fully account for opportunity costs when making investment decisions. d. Statements a and c are correct. e. All of the statements above are correct. Relevant cash flows Answer:
Words: 21266 - Pages: 86
