Intro to Accounting & Business PDF

INTRO TO ACCOUNTING & BUSINESS Lesson Outline Types of Business Organizations Types of Business Operations History of Accounting Accounting Information System Financial Statements Types of Business Activities  BUSINESS is an economic u...

INTRO TO ACCOUNTING & BUSINESS Lesson Outline Types of Business Organizations Types of Business Operations History of Accounting Accounting Information System Financial Statements Types of Business Activities  BUSINESS is an economic unit - Controls resources (cash, assets, non cash asset - Engaged in buying and selling of goods and services.  ACCOUNTANTS will show you how the How do we measure the success in business activities are business? *Measure in terms of profit shaped into relevant * Increased of funds financial reports which *Money, machines, men and materials provide these people are use efficiently at the with much needed least possible information so they can cost. * Quality of service make correct and timely decisions for the firm to succeed.  BOOKKEEPING means keeping track of the revenues and expenses as well as the assets and liabilities is a basic procedure in accounting. It is the first phase of accounting which involves gathering financial data and keeping a record of this.  ACCOUNTING is more comprehensive. It involves the preparation of various financial reports for planning and controlling the various activities of the business. Sources of Capital: Main Source - owner Other Sources- creditors (financing institution, relatives or friends)  TYPES OF BUSINESS ORGANIZATIONS PROPRIETORSHIP PARTNERSHIP CORPORATION Advantages: Advantages:  More financial Advantages:  Easy and low cost in resources than a The ability to obtain organizing proprietorship. large  All profits goes to the  Additional amounts of resources by issuing owner. management skills stocks.  Division of Labor Limited liability Disadvantages Unlimited life- 50 yrs  Limited source of Disadvantages: financial  Limited source of Disadvantages source financial Subject to rigid  Unlimited Liability resources government  Unlimited liability control Costly to organize  TYPES OF BUSINESS OPERATIONS SERVICE MERCHANDISING MANUFACTURING the one who buys Provide services to Is one which buys raw materials, customers and sells goods. processes these into finished goods and then sells these to customers.  HISTORY OF ACCOUNTING Try the following combinations of search terms and modifiers in a search engine Earliest Accounting System Bookkeeping was introduced to the Phil. by 200BC Babylonia, the Spaniards. Greece, Egypt-3500BC Tenedor de Libro- Assyria bookkeeper 1923-first CPA licensure Father of Accounting exam - Fr. Luca Pacioli wrote the 1929-establishment of Summa Aritmetica, PICPA Geometria, Proportioni et Proportinalita in 1494. “Accounting is the language of business”  Accounting Information System It involves an orderly way of accumulating and reporting business transactions through a process of: Analyzing, measuring, recording, classifying, summarizing. And from which reports are generated for proper communication to decision makers.  FINANCIAL STATEMENTS STATEMENT OF INCOME OWNER’S EQUITY STATEMENT OF STATEMENT OF FINANCIAL CASH FLOWS STATEMENT POSITION A A summary A list of the assets, summary of the summary of the of the revenue and liabilities, cash receipts changes in the expenses and owner’s equity and disbursements owner’s equity that for a specific period as of a for a specific have of time. specific date. Also period of time. occurred during a known as specific period balance sheet. of time. INCOME STATEMENT STATEMENT OF OWNER’S EQUITY STATEMENT OF FINANCIAL POSITION STATEMENT OF CASH FLOW  TYPES OF BUSINESS ACTIVITIES FINANCING INVESTING OPERATING ACTIVITIES ACTIVITIES ACTIVITIES – owner invested a capital acquisition of land, related to earning a profit or if not sufficient, can be equipment, furniture and which includes selling goods extended by banks and machineries and services and by other financing institutions incurring cost and expenses. EXAMPLE ASSIGNMENT. Please answer in a one whole sheet of paper. ASSIGNMENT THANK YOU! PROF. REY