RSM219H1 Chapter Notes - Chapter 1: Fiscal Year, Deferred Tax, Accounting Equation
20 Sep 2013
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RSM219H1 Full Course Notes
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Document Summary
Chapter 1: the purpose and use of financial statements. Accounting ( the language of business ): the information system that identifies and records the economic events of an organization, and then communicates them to a wide variety of interested users. Users of accounting information can be divided into: internal users. They plan, organize, and run companies (work for the companies). Is there enough cash to pay the bills? (finance) What should we sell ipads for to maximize profit? (marketing) How many employees can we afford to hire this year? (human resources) Which production line is the most profitable? (production) Accounting information must be available when its needed: external users. Investors (whether to buy, hold, or sell their ownership interest) Other creditors i. e. suppliers (whether or not to grant credit; sell on account) Employees and labour unions (can they provide employment opportunities and pay salaries and benefits) Customers (will they support its product lines and honour product warranties)
