Business Transactions And Financial Statements

Discussion

1.-What kind of accounting system should each business have? What should the method provide?
R=the method used must provide the most effective means of recording, summarizing, andpresenting appropriate accounting data for management and for others who have an interest in the business.
2.-For what is an accounting responsible in setting up a system?
R=for design andimplementation of the accounting forms, the records, and the procedures.
3.-What kind of equipment can be utilized where speed is important?
R=Modern accounting machines and data-process equipment havesubstantially increased the speed with which information can be made available to management.
4.-How are transactions recorded in accounting systems?
R=monetary terms.
5.-What are some typical businesstransactions? Are all of them outside the organization?
R=manufactures, store, warehouse, customers.
6.-What is the unit of measure in accounting in the United States? Is it used anywhere else?
R=inaccounting in the United States, and it is also widely used as a measurement in international transactions.
7.-What is entered in the accounting records of the business? Where does this informationusually appear first?
R=information about the nature of a transaction and the dollar amount that is involved generally appears first on a business document, such as a sales invoice.
8.-Why are businesspapers such as sale invoices considered essential references in accounting?
R=because they reflect alterations in the company´s financial position and operating performance.
9.-What are two basicfinancial statements in a business?
R=balance sheet and the operations statement
10.-What does the balance sheet show?
R=the firm’s condition on the last day of the accounting period. It shows whatthe business owns and what it owes to its creditors or its owners
11. What is the formula that expresses a state of equilibrium for a business?
Assets= liabilities+equity of the shareholders
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