ACC 100 Study Guide - Final Guide: Current Liability, Accrual, Financial Statement
Document Summary
The purpose of accounting is to identify, measure, and communicate financial information to stakeholders. Another reason of accounting would be to give economic information to various users. Define the three business activities of a company and provide examples of each of these activities. There are three business activities included in a company. They are known as operating, investing, and financing activities. Operating activities are known as the day-to-day business activities of a company. An example of an operating activity would be selling a product or service for cash. In this case, it would be a cash inflow because the company earns the cash by providing their service. This would be considered a day-to-day business activity because the company is making revenue. Investing activities are defined by the purchasing and selling of long-term assets. An example of that would be the purchase of machinery for use in the company.
