Chapter 1 - Introduction Flashcards
What is Bookeeping
The activity or occupation of recording the financial affairs of a buisness which includes the sale of goods and services. This is on a day to day bases. Typically done on spreadsheet.
What is the difference between Accountants and Bookeepers
Accountants provide a wider view to the information gathered by bookeepers from the different areas of the buisness this is in order to interpretate and analyse them presenting them through financial statments. Examples of potenial reasons for this are to see if the buisness is solvent or making a profit or loss.
What is a stakeholder ?
Provide a few examples and their reasons for being stakeholders
A stakeholder is an indivudal or entities who have an interest in the accounts of a buisness
Manager - To assess whether specific revenue streams are profitbale e.g in the cake shop example by assessing the accounts they are able to determine that bananna bread is more profitbale than cupcakes.
HMRC/Government - To asses the revenue a company is making and thus determine whether they are paying the correct tax amount.
Investors - To analyse whether their investments into a company are actually worthwile or any investments they have done are profiting
Finance Providers - As they provide finance to buisness they need to assess whether it is able to pay back the loan/finance.
