Documente Academic
Documente Profesional
Documente Cultură
Accounting
Principles
CHAPTER
Accounting in business
THE ACCOUNTING PROCESS
Communication
Identification Recording Account
ing
Reports
Prepare
accounting reports
SOFTBYTE
Select economic events Record, classify, Annual Report
Will the company be able to pay its debts as they come due?
BOOKKEEPING DISTINGUISHED
FROM ACCOUNTING
Accounting
1. Includes bookkeeping
2. Also includes much more
Bookkeeping
1. Involves only the recording of economic
events
2. Is just one part of accounting
THE ACCOUNTING PROFESSION
INCREASES DECREASES
Investments Withdrawals
by Owner by Owner
Owner’s
Equity
Revenues Expenses
TRANSACTION ANALYSIS
BANK
Softbyt
e
TRANSACTION ANALYSIS
TRANSACTION 1
On September 1, he invests $15,000 cash in the
business, which he names Softbyte.
• Annual Reports
– Non-financial
information
– Financial
information