ACCT 2100 REVIEW

THE BIG PICTURE:

Decision makers need information so they can make informed decisions. But whenever we make a decision, there is a risk that we will make a bad decision and face adverse consequences. The more good information we have, however, the better decisions we can make.

Irrespective of the Type of Business or the Forms of Business Ownership, accountants provide financial information to decision makers about the economic events of a company. Managers need this information to know how to run a company to achieve their financial objectives. Investors or creditors need this information to assess the risk and return on their investments.

We can view what companies do to create value for their investors and creditors in two ways:

The transformation process:
input (resources)àprocess(activities)àoutput(goods/services)àvalue(profits)

The business activities:
FinancingàInvestingàOperatingàCreating value


To develop information about the transformatio...