BUS 251 Chapter Notes - Chapter 1-3: Profit Margin, Deferral, Historical Cost
Document Summary
Chapter 1 overview of corporate financial reporting. Business plan to profit from selling a product or service. Can be an individual or thousands of owners (investors). Accounting is an information system in which the underlying economic conditions of organizations and of individuals are recorded, summarized, reported, and understood. Financial statements: management"s reports to the companies" owners that summarize how the company performed during a particular period. Also tells users what the company owns, to whom it has obligations (debts), and what is left over after the obligations are satisfied (paid). Annual report: the main method that management uses to report the results of the company"s activities during the year. In january 1st, 2011, canada changed the underlying standards that are used to collect, record, and report accounting information. From canadian standards to international financial reporting standards (ifrs). Profit-seeking entities such as corporations; governing organizations. Service entities such as hospitals and academic institutions. We will be concentrating on profit-seeking entities.