Acct076 Chp 1 Acctg

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Acct076 Chp 1 Acctg

  1. 1. <ul><li>College Accounting </li></ul>Heintz & Parry 20 th Edition
  2. 2. <ul><li>Introduction to Accounting </li></ul>1 Chapter
  3. 3. <ul><li>Describe the purpose of accounting </li></ul>1
  4. 4. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPTAA048430.JPG </li></ul>The Purpose of Accounting <ul><li>To provide: </li></ul><ul><li>Financial information about the current operations and financial condition of a business to individuals and organizations </li></ul>
  5. 5. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPT256021.jpg </li></ul>Who Are the Users of Accounting Information? <ul><li>Owners </li></ul><ul><li>Managers </li></ul><ul><li>Creditors </li></ul><ul><li>Government Agencies </li></ul>
  6. 6. <ul><li>Describe the </li></ul><ul><li>accounting process. </li></ul>2
  7. 7. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPTAA048434.JPG </li></ul>The Accounting Process <ul><li>Accounting is a system of: </li></ul><ul><li>Gathering financial information about a business and reporting this information to users </li></ul>
  8. 8. Step One Looking at events that have taken place and thinking about how they affect the business. ANALYZING
  9. 9. Step Two Entering financial information about events into the accounting system. RECORDING
  10. 10. Step Three Sorting and grouping similar items together rather than merely keeping a simple, diary-like record of numerous events. CLASSIFYING
  11. 11. Step Four The aggregation of many similar events to provide information that is easy to understand. SUMMARIZING
  12. 12. Step Five Telling the results. Use of numbered tables in accounting is common. REPORTING
  13. 13. Step Six Deciding the meaning and importance of the information in various reports. INTERPRETING
  14. 14. <ul><li>Define GAAP and describe the process used by FASB to develop these principles. </li></ul>3
  15. 15. GAAP <ul><li>Generally Accepted Accounting Principles (GAAP) </li></ul><ul><li>Developed by the Financial Accounting Standards Board (FASB) </li></ul><ul><li>Procedures and guidelines to be followed in the accounting and reporting process </li></ul>
  16. 16. Process Used by FASB to Develop GAAP <ul><li>Identify an accounting issue </li></ul><ul><li>Place on the agenda </li></ul><ul><li>Research an issue </li></ul><ul><li>Issue a discussion memorandum </li></ul><ul><li>Hold public hearings </li></ul><ul><li>Issue an exposure draft </li></ul><ul><li>Issue a Statement Of Financial Accounting Standards (SFAS) </li></ul>
  17. 17. <ul><li>Define three types of business ownership structures. </li></ul>4
  18. 18. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPT200022011-001.jpg </li></ul>Three Types of Ownership Structures <ul><li>Sole proprietorship </li></ul><ul><li>Partnership </li></ul><ul><li>Corporation </li></ul>Use a call out box like this or like below.
  19. 19. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPT360009C.jpg </li></ul>Sole Proprietorship <ul><li>One owner </li></ul><ul><li>Owner assumes all risk </li></ul><ul><li>Owner makes all decisions </li></ul>Use a call out box like this or like below.
  20. 20. Partnership <ul><li>Two or more partners </li></ul><ul><li>Partners share risks </li></ul><ul><li>Partners may disagree on how to run the business </li></ul>
  21. 21. Corporation <ul><li>Stockholders </li></ul><ul><li>Stockholders have limited risk </li></ul><ul><li>Stockholders may have little influence on business decisions </li></ul>
  22. 22. <ul><li>Classify different types of businesses by activities. </li></ul>5
  23. 23. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPT200023529-001.jpg </li></ul>Types of Businesses <ul><li>Service business </li></ul><ul><li>Merchandising business </li></ul><ul><li>Manufacturing business </li></ul>
  24. 24. Service Business A business that provides a service. Travel Agency Physician Computer Consultant
  25. 25. Merchandising Business A business that buys a product from another business to sell to customers. Department Store Jewelry Store Pharmacy
  26. 26. Manufacturing Business A business that makes a product to sell. Automobile Manufacturer Toy Factory Furniture Maker
  27. 27. <ul><li>Identify </li></ul><ul><li>career opportunities in accounting. </li></ul>6
  28. 28. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPT360001A.jpg </li></ul>Career Opportunities in Accounting <ul><li>Accounting clerk </li></ul><ul><li>Bookkeeper </li></ul><ul><li>Para-accountant </li></ul><ul><li>Accountant </li></ul>
  29. 29. Accounting Clerk <ul><li>Record, sort, and file accounting information </li></ul><ul><li>Often specialize in one area (such as cash, payroll, accounts receivable, accounts payable, inventory, or purchases) </li></ul><ul><li>Usually have at least one year of accounting education </li></ul>
  30. 30. Bookkeepers <ul><li>Supervise the work of accounting clerks </li></ul><ul><li>Help with daily accounting work </li></ul><ul><li>Summarize accounting information </li></ul><ul><li>Help managers and owners interpret accounting information </li></ul><ul><li>Usually have one to two years of accounting education and experience as an accounting clerk </li></ul>
  31. 31. Para-Accountants <ul><li>Provide many accounting, auditing, or tax services under the direct supervision of an accountant </li></ul><ul><li>Have two years of accounting education or significant accounting and bookkeeping experience </li></ul>
  32. 32. Accountants <ul><li>Design the accounting information system </li></ul><ul><li>Focus on analyzing and interpreting information </li></ul><ul><li>Look for important trends in the data </li></ul><ul><li>Study the impact of alternative decisions </li></ul><ul><li>Enter the field with a college degree in accounting </li></ul>
  33. 33. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPTAA048502.JPG </li></ul>Accounting Careers <ul><li>Public accounting </li></ul><ul><li>Private accounting </li></ul><ul><li>Governmental and not-for-profit accounting </li></ul>
  34. 34. <ul><li>C:Documents and Settings janderson DesktopPhotos to use for Heintz PPTAA048448.JPG </li></ul>Public Accounting <ul><li>Offer services to the public </li></ul><ul><li>CPA (Certified Public Accountant) </li></ul><ul><li>Auditing, Taxation, Management Advisory Services </li></ul>
  35. 35. Private Accounting <ul><li>Employees of private businesses </li></ul><ul><li>Controller </li></ul><ul><li>Accounting Information Systems; Financial, Cost, and Tax Accounting; Budgeting; and Internal Auditing </li></ul><ul><li>CMA (Certified Managerial Accountant) </li></ul><ul><li>CIA (Certified Internal Auditor) </li></ul>
  36. 36. Governmental and Not-for-Profit Accounting <ul><li>Work in all levels of government </li></ul><ul><li>Also employed by universities, hospitals, charities, etc. </li></ul><ul><li>Gather and report financial information </li></ul>

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