1.1 Accounting in Action
What is Accounting?
• Accounting provides financial information to users for making decisions
• Accounting is often referred to as the +
• Accounting is the process of planning, recording, analyzing, and +
Terms
• Accounting System – is a planned process designed to compile financial data and summarize the results in accounting records and reports
• Financial statements – financial reports that summarize the financial conditions and operations of a business
• Net Worth Statement – shows what a person owns and owes and is used for making credit lending decisions
• Asset – +
• Liability – +
Terms
• Equity – is the difference between assets and liabilities
• Accounting Equation – +
• Double underlines under a number means +
• Dollar signs are not always used
• Ethics – the principles of right and wrong that guide an individual in making decisions
• Business Ethics – principles used to make business decisions
Review
• What is Accounting
• Why is accounting called the language of business
• Describe a scenario in which you, as a non accountant, might us accounting
Work Together 1-1
• Megan finder, a recent college graduate, is applying for her first credit card. The creditor has asked for a personal net worth statement, Megan has $800.00 in her checking account and owns a scooter worth $2000. she owes Jaycee Auto $920 and River College $125. Complete a new worth statement for Megan Finder. Use the current date.
On Your Own 1-1
• Anthony clement is applying for a car loan. The leading institution requires a personal net worth statement. Anthony currently has $1085 in cash, and his camera is worth$635. He also owes Kelley Electronics $83 and Vista Travel $305. Complete a net worth statement for Anthony clement. Use the current date.
Assets
Total Assets
Liabilities
Total Liabilites
Net Worth