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|Something we physically own in order to make money in a business. ex: money, building, fixtures, inventory.
|Something we are financially responsible for
|Money Put Towards a buisiness whether it be personal or invested
|Separate Legal Business Entity, Independent from other businesses
|Examine financial statements to assure they are lawful and accurate
|Separate legal entity in which shares are sold to the public and actively traded in the market
|Security Exchange Commission.
|Separate legal entity. Illegal to sell shares to the public. Usually very few stockholders and trading.
|Not a separate legal entity: ran by one person. Little legal setup, life parallels that of the owner and there is no protection of personal assets.
|Not legally separate from the owners. Capital raised by individual partners. Members bound to eachother by position.
|Like a partnership structurally, but with the protection of assets.
|Limited Liability Corporation (LLC)
|Maximize shareholder wealth. Therefore, the managers have a moral and social responsibility to achieve the goals of the shareholders.
|Goal of For Profit Entities
|Recording, classifying, and summarizing of economic events for the purpose of providing financial information used in decision making. Basis for financial analysis.
|Managing an organization'f funds to ensure they are being properly used to achieve the objectives. Does actual financial analysis.
|Handles money, responsible for cash flow and the issuing of stocks and bonds.
|Controls budgets and financial/managerial reporting.
|United States Generally Accepted Accounting Principles
|International Financial Reporting Standards
|Report financial results to a company in a comparable ways using the USGAAP and IFRS in order to provide clear and fair presentations. Enables year to year comparison and comparison to other firms.
|Role of Financial Accounting
|Provides information on entity as a whole, often for external parties. Follows the GAAP and IFRS
|Provides information for internal management at either a product or division level including budgets, salaries, price determination, etc.
|Increase in a person's overall wealth over time.
|Profit from specific transactions that are recorded on financial statements.