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    Accounting is the business discipline that studies how a company's financial information can be manipulated and presented, in a meaningful way, to enhance the decision-usefulness of that financial information. We typically think of accounting as incorporating three related disciplines: financial accounting, management accounting, and auditing.

    Financial accounting

    Financial accounting looks to present financial information that is useful to external users, such as investors and creditors, who use this information to make resource allocation decisions between businesses. This information is subject to IFRS or US GAAP, is prepared using double-entry bookkeeping, and is presented in four required financial statements: the balance sheet, the income statement, the cash flow statement, and the statement of owner's equity.

    Management accounting

    Management accounting deals with information that is used by internal users, such as a business's managers, who use this information to make resource allocation decisions within the firm. These include short-run production decisions and long-run capital budgeting decisions. (At BrainMass.com, we look at capital budgeting decisions under Corporate Finance.)

    Management accounting information comes in a variety of financial reports, including budgets. This information is not subject to accounting standards, and how this information is prepared changes based on the costs of collecting financial information and the benefits that this information has for management decision-making. As a result, a variety of different management accounting techniques are used.


    Auditing typically refers to financial auditing of public companies. Financial audits are conducted by independant external auditors, who provide an opinion about a company's financial reports. These auditors must adhere to Generally Accepted Auditing Standards (GAAS) in the United States, and their opinions give investors reasonable assurance that financial reports are true, fair, and adhere to applicable accounting standards. The auditor must also include an opinion about the effectiveness of a company's internal controls.

    In addition to the financial audit, there is a range of many different types of audit and assurance services. Many financial auditing firms also provide a range of these services, giving feedback about the effectiveness of a company's processes and procedures. These services may also be provided by in-house internal auditors that work within a single company.

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    BrainMass Categories within Accounting

    Financial Accounting & Bookkeeping

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    Payroll Accounting: Ryan Company

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    Peter's Pool Corp: July transaction journal entries

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    Black, White, and Green partnership: Allocating Income

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    Consolidation worksheet and the Parent or Subsidiary

    A clerk in the accounting department recently entered trial balance data for the parent company and its subsidiaries in the company's consolidation program. After a few minutes of additional work needed to eliminate the intercompany investment account balances, the clerk expressed his/her satisfaction with having completed the c

    Breakeven: Robotic device

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    Killearn: Deferral of Intra-entity Gross Profit and more

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    Southwestern Edison Hi-Tech Leasing Journal entries for 2018

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    Cheyenne Hotel: Using the High-Low Method

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    Cost Volume Profit Analysis Basics

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    Morrison-Greene: Six Ways to Allocate Partnership Income

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    Abnormal Accrual Models: Detect Earnings Management

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    City of Monroe: General Fund entries and statements governmental

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    Partnerships and Corporations: major lawsuit probable damages

    Assume your company is involved in a major lawsuit and the probable damages are estimated to be $2,000,000. A. Describe the effects damage estimates would have on the financial statements of a corporation and a partnership. B. How do disclosure requirements differ from a corporation to a partnership and what information is re

    Statement of Changes in Financial Position Amazon 2017

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    What is meant by financial flexibility? (airline industry)

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    Dialyze USA Capital Budgeting NPV risk sensitivity analysis

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    Nordic Company issued bonds with the following provisions

    Nordic Company issued bonds with the following provisions Maturity value: $60,000,000. Interest: 7.9 percent per annum payable semi-annually each June 30 and December 31. Terms: Bonds dated January 1, 2017, due five years from that date. The company's fiscal year ends on December 31. The bonds were sold on January 1, 2017, a

    IRS Determination Letters

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    Tax Research Environment: Determination Letters

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    https://www.cchdaily.co.uk/ifrs-rules-distort-debt-reporting (Regarding this article) Does IFRS distort debt reporting? Does it give a false report of a business's financial standing? Explain.

    NPV to buy Complex Apartment

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    Cash Purchase Budget & Inventory Purchase

    A company has adopted the following policies regarding merchandise purchases and inventory. At the end of any month, the inventory should be $18,500 plus 80% of the cost of goods to be sold during the following month. The cost of merchandise sold averages 75% of sales. Purchase terms are generally net 30 days. A given month's

    Capital budgeting using the NPV method

    EnterTech has noticed a significant decrease in the profitability of its line of portable CD players. The production manager believes that the source of the trouble is old, inefficient equipment used to manufacture the product. The issue raised, therefore, is whether EnterTech should (1) buy new equipment at a cost of $120,00

    Net present value decisions

    The division managers of Chester Construction Corporation submit capital investment proposals each year for evaluation at the corporate level. Typically, the total dollar amount requested by the divisional managers far exceeds the company's capital investment budget. Thus, each proposal is first ranked by its estimated net pr

    Return on average investment, Payback, PV & NPV

    Pack & Carry is debating whether to invest in new equipment to manufacture a line of high-quality luggage. The new equipment would cost $1,728,125, with an estimated five-year life and no salvage value. The estimated annual operating results with the new equipment are as follows: Revenue from sales of new luggage . . . . .