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[ACC 100] - Final Exam Guide - Comprehensive Notes fot the exam (32 pages long!)


Department
Accounting
Course Code
ACC 100
Professor
peterkalvin
Study Guide
Final

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Ryerson
ACC 100
FINAL EXAM
STUDY GUIDE

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Chapter One Introduction to Accounting
What is a business?
The atiit of akig, uig, or sellig goods or proidig series i ehage for oe.
This defiitio fouses o For-profit” businesses which are businesses whose purpose is to
make a profit. Other types of businesses are not-for-profit (charities) or barter businesses
(exchange one good or service for another).
What are the three main business sectors?
1. Write a definition of the primary sector. What industries would be categorized in the
primary sector?
A primary sector is a business that grows and gathers raw materials. Industries such as
farming and mining are considered primary sectors.
2. Write a definition of the secondary sector. Give examples of three businesses that
would be categorized in the secondary sector.
The secondary sector is where raw materials are turned into products. Three businesses include
car manufacturing, cardboard box factory and frozen food factories.
3. Write a definition of the tertiary sector. Provide the names of three companies that
would be categorized in the tertiary sector.
The tertiary sector is where goods and services are sold to consumers. Three companies that
are categorized in the tertiary sector include Walmart, Forever 21 and Loblaws.
Check Your Understanding: A fashion designer would be categorized in which business sector
and why are they categorized under that sector?
A fashion designer would be categorized under the secondary business sector because they
turn raw materials into products that will be sold in the tertiary sector to consumers.
Answer from professor: That depends on what the fashion designers do! If the fashion designers
are part of the process of turning fabric into finished goods (clothing) they would be part of the
secondary sector. If the fashion designers only design the clothing (which is a service) then they
would be part of the tertiary sector.
Course Focus: The course focus will be the tertiary sector, concentrating first on retailers and
then on wholesalers.
A retailer earns a profit by reselling goods or providing services to consumers (the public) to
satisfy their wants and needs.
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A wholesaler buys large quantities of goods from manufacturers, warehouses them, and then
resells them to retailers. Wholesalers generally do not sell to consumers.
Who cares about a business and why?
Stakeholders are individuals or groups who either affect the business or are affected by the
actions of the business. Every stakeholder has an objective, something they want from their
relationship with the business.
Internal stakeholders work for the business. Their objectives generally relate to their ability to
keep their jobs, do their jobs more efficiently, get promoted, and get paid for their work.
External stakeholders are outside of the business and their objectives generally relate to
decisions they will make about money (also called resource allocation decisions) or about how
the business can affect them, either positively or negatively.
Internal Stakeholders:
Stakeholders
What they want
General Employee
Earn high wages and keep their jobs
Marketing Manager
Impact of advertising (marketing campaigns)
Company Lawyer
Ensure laws are followed
Tax Manager
Ensure taxes are minimized and tax laws are
followed
Owners (sole proprietor)
Maximize profit, grow/expand business
External Stakeholders
Stakeholder
What they want
Shareholders (of a corporation)
Decide to invest or not invest, earn income from
their investment
Governments
Ensure businesses pay taxes, employ more
people, follow laws
Customers
Buy quality products at low prices, get the best
warranties on products or services
Suppliers
Sell products/services to the business, get paid
on time and in full
Creditors (bank)
Decide whether to lend money and how much,
ensure business repays loans plus interest on
time
Society/Community
Employ people from the community, improve the
standard of living, run their business in an ethical
manner, reduce/eliminate any negative
environmental effects of their business practices,
support local charities
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