ACCTMIS 2200 Lecture Notes - Lecture 1: Legal Personality, Sole Proprietorship, Financial Statement

• School: Ohio State University
• Department: Accounting and Management Info
• Course: ACCTMIS 2200
• Professor: Marc Smith

Document Summary

Often happens when one person lacks economic resources. Pull resources from different people to create partnerships a) Owned by many people (stockholders) who own stock in company. Owner investment and then selling shares of ownership through stock. No repayment legally required, but dividend is paid to investors. Links decision makers to economic activities and results. In order to see what"s going on in the company, accountants give a summary of the economic activities, which is shown to the decision makers. These decision makers (cid:894)stockholders/(cid:373)a(cid:374)agers(cid:895) (cid:373)ake decisio(cid:374)s that creates (cid:373)ore eco(cid:374)o(cid:373)ic activit(cid:455). Info used by insiders (people in the company) Info used by outsiders (people outside of company, investors, creditors etc. ) Get info to outsiders through financial statements (accounting reports) (3) Standard accounting rules to allow for easy comparison of financial statements between two companies. Private sector that develops most of accounting rules. Does (cid:374)ot have e(cid:454)press authorit(cid:455) to develop gaap so i) ii)