Use the internet to research one manufacturing, one retail (or merchandising), and one service business. For each business, describe the following:
A. the primary purpose of the entity
B. the types of activities that accountants would record (hint: what is the source of the business’ funding, and what costs might the business have?)
C. the types of decisions that might be made in this organization and how financial and nonfinancial information might help the decision-making process
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Chapter 1 Solutions
Principles of Accounting Volume 1
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- Accounting information helps key stakeholders of the business to make decisions.From the following options,which one is the decision that an internal stakeholder is unlikely to make? A.Make decisions about how toset product selling price,whether to advertise and how much to spend on advertising B.Decide which products to continue to sell and when to add new products or drop old ones C.Identify what resources and employees the business needs,and to set benchmarks against which they can later measure the business's progress towards its goals D.Analyse the business's financial reports to decide whether to purchase shares of the companyarrow_forwardJeff Brown is evaluating two companies for future investment potential. Jeff’s task is made easier becauseboth companies use the same accounting methods when preparing their financial statements. Which characteristic does the information Jeff will be using possess?arrow_forwardResearch topics on the balance sheet. Why is this financial statement so important to businesses? What part of the balance sheet is the most scrutinized? How do various stakeholders inside the business and outside the business use the information on the balance sheet to help make decisions in regard to a business?arrow_forward
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