Better T1 Doyle Ch 1 pg 1-2 Flashcards
Who are the two types of accounting information users?
💡 Internal and External users.
Who are internal users of accounting information?
Business managers, sole proprietors, and partners.
Who are external users of accounting information?
Shareholders, potential investors, creditors, employees, and the ATO.
What are the two main types of accounting?
Management Accounting and Financial Accounting.
What is management accounting?
Preparation of reports for internal users (business managers).
What are examples of management accounting information?
Cost of manufacturing
Break-even point of a product
Expected cash balance for the next 12 months
What are the two types of accounting reports?
External and Internal reports.
What is financial accounting?
Preparation of external reports such as the Balance Sheet.
What is a Balance Sheet (Statement of Financial Position)?
A report showing assets, liabilities, and equity at a specific date.
What is the Statement of Profit or Loss?
A report showing income, expenses, profit/loss, and asset revaluation over time.
What is a budget?
A financial plan for the future of a business, expressed in money terms.
What are internal accounting reports used for?
They are for business managers and not shared externally.
