ACCTG 201 Study Guide - Comprehensive Midterm Guide: Financial Accounting Standards Board, International Accounting Standards Board, Public Company Accounting Oversight Board
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Accounting a s(cid:455)ste(cid:373) of (cid:373)ai(cid:374)tai(cid:374)i(cid:374)g (cid:396)e(cid:272)o(cid:396)ds of a (cid:272)o(cid:373)pa(cid:374)(cid:455)"s operations and communicating that information to decision makers; (cid:862)the la(cid:374)guage of (cid:271)usi(cid:374)ess(cid:863) Accountants measure the activities of the company and communicate those measurements to others. Managerial accounting accounting information that is provided for internal users (managers) Financial accounting accounting information provided to external users. Investors want to make good decisions related to buying and selling thei(cid:396) sha(cid:396)es of the (cid:272)o(cid:373)pa(cid:374)(cid:455)"s sto(cid:272)k. Creditors make decisions related to lending money to the company. Investors buy ownership in the company and have the right to share i(cid:374) the (cid:272)o(cid:373)pa(cid:374)(cid:455)"s p(cid:396)ofits: share = share of common stock. If you borrow ,000 from the bank for your business, the bank is your creditor. Corporation a company that is legally separate from its owners. Limited liability prevents stockholders from being held personally responsible for the financial obligations of the corporation. Sole proprietorship a business owned by one person. Partnership a business owned by two or more persons.
