Read the summary and the most important questions on Financial Accounting for Decision Makers with MyAccountingLab Access Card | 9780273785767 | Peter Atrill; Eddie McLaney

• 1 Introduction to accounting

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• Who and what are the 10 'User Groups' (for a typical private-sector business)? 

  User groups are various groups of people with an interest in a particular organization. 

  
  Owner, Customers, Competitors, Employees and their representatives, Government, Community representatives, Investment analysts, Suppliers, Lenders and Managers. 

• What sources of information might an investment analyst use in a tempt to gain an impression of the financial position and performances of a business? 

  - Meetings with managers of the business

  - Public announcements made by the business. 

  - Newspaper and magazine articles

  - websites, including the one of the business

  - radio and TV reports

  - Information-gathering agencies

  - industry reports

  - Economy wide reports

  
  

  These sources can provide information on various aspects of the business, such as new products or services being offerend, management changes, new contacts offered etc. 

• How can investors (share holders) change their view on a company? 

  When a business makes an announcement concerning its accounting profits. This changes their view of the future prospects of the business as a result of this new information. This, in turn, leads them to make a decision either to buy or sell shares. 

• What are four certain features of  the 'Accounting Information System'?

  
  - Identifying and capturing relevant (financial)information;

  - Recording, in a systematic way, the information collected;

  - Analyzing and interpreting, the information collected; 

  - Reporting, the information in a manner that suits the needs of users.

• What is 'Sole Proprietorship'? 

  An individual is the sole owner of a business. 
  

  This kind of business is often quite small in terms of size. It's easy to set up,. 

• What are the main advantages of forming a partnership business rather than a limited liability company?

  - The ease of setting up a business
  

  - The degree of flexibility concerning the way in which the business in conducted

  - The degree of flexibility concerning restructuring and dissolution of the business

  - Freedom from administrative burdens imposed by law

• What are the three tasks of the board? 

  1. Setting the overall direction and strategy for the business

  2. monitoring and controlling the activities of the business

  3. communicating with shareholders and others connected with the business

• 2 Measuring and reporting financial position

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• Why are private and business balance sheets separated? 

  Because now when the business goes bankrupt, they can't touch your private assets. 

  Also, now more people can join your business. 

• What are the two rules to calculate assets and equity? 

  Rule 1: Equity first January + profit = equity end December 

  Rule 2: assets = liability + equity 

• What is the difference in an 'income statement' and 'cashflow'? 

  That in income statement the price is different, but the cash flow only registries what is actually happening in cash at the moment.