ACCOUNTING
Dec 22, 2015
Accounting
Is an information system that provides reports to stakeholders about the economic activities and
conditions of a business.
ACCOUNTING PROFESSIONS
Private
Non Profit
Controller
Public CPA
Specialize
Financial Accounta
ntManagerial
AccountantCost
Accounting
Following the Rules
Generally Accepted Accounting Principals
(GAAP)
• The rules companies follow when they are reporting their data to others.
Financial Accounting Standards Board (FASB)
• Responsible for developing Accounting Principals
Assets Liabilities Owners Equity
Assets Liabilities Owners Equity
5000 5000
200
200
1700 1700
The owner deposits $5,000 cash into the company.
They purchase $200 worth of supplies and pay for it in cash.
They buy $1,700 worth of office equipment and charge it to pay later.
More Transactionsa) Bob Bingo makes a deposit into his new company
of $15,000.
b) The Business purchases some land for the company for $10,000.
c) The company purchases $1,350 worth of supplies, but we put in on our charge account to pay for it later when they bill us.
d) We did some work for customers and they are paying us $7,500.
e) We have to pay some of our expenses: wages $2,125, rent $800, and utilities $275.
f) The bill for the supplies has arrived, and we need to make a payment. We are going to pay $950 of the $1,350 we owe.
g) At the end of the month Bob Bingo withdrawals $2,000 for personal use.
What are our Account Balances?
AssetsCash $6,350Supplies
$1,350Land $10,000
Liabilities $400
Owners Equity $17,300
Total Assets $17,700 Total Liabilities and Owners Equity
$17,700
Financial Statements
Income Statement Statement of Owners Equity Balance Sheet Statement of Cash Flows