Accounting Ch. 1

Provides services rather than products to customers?

These businesses purchase products form other businesses and sell these products to customers.

This business change basic inputs into products that are sold to customers.

Accounting.. defined...

1. Identify users
2. Asess users info needs
3. design accounting info system to meet users needs
4. record econ data of business activities and events.
5. prepare accounting reports for users

Consist of managers and employees.

Includes customers, creditors, investors, and government. 
Not directly involved in managing business

Suggests revenue should be recognized when it is earned, normally is when the work is performed or the good are delivered.

Recognizing transactions and events by the amount of cash paid or received.

Suggests.. a trade-off exists between the accuracy of the financial information being produced and the cost to produce that info.

The IFRS framework identifies 3 characteristics as fundamental to produce financial info 

pg 9

Financial info is enhanced if it is.. 


pg 10

This.. embodies future benefit that will contribute to directly&indirectly to future cash flows, business can control access to the benefit, transaction or recent giving rise to the benefit has already occurred.

This is.. an obligation to give up either services or assets. They have three characteristics..
A duty to others that involves giving up a service or asset
Unavoidable
Transaction or event already occured

The rights of the owners are called owner's equity which is....

The accounting equation is 

Look at pg 11