BUEC 232 Chapter Notes - Chapter 1: Financial Accounting, Financial Statement, Making Money
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BUEC 232 Full Course Notes
Accounting is a system for producing information about an entity and communicating that information to people who want the information for making decisions. The cost/benefit trade-off is the concept of comparing the benefits of an action with the costs of the action, and taking the action only if the benefits are greater than the costs. Information should be collected only if the benefit is greater than the cost. It is usually too costly to obtain all possible information and so all information is usually not collected. Explain the difference between financial and managerial accounting. Give an example of a decision that reflects each of these two fields of accounting. Financial accounting refers to the field of accounting that provides information to people who are external to an entity. These external users of accounting information include investors, lenders, taxation authorities (canada revenue.