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Accounting objectives; basic terminology, ethics, technology

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1. What are the primary objectives of accounting?

2. What is the basic terminology of the accounting process or financial reporting?

3. How does accounting affect your personal life emphasizing professional ethics?

4. How does technology play a role in small business accounting?

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1. What are the primary objectives of accounting?

The objectives of an accounting system are:
1. To record financial data in a format that can be used for comparability and for the compilation of financial statements that can provide accurate and reliable information to stakeholders of an entity.
2. To account for assets with the goal of controlling and safeguarding them by tracking and recording their book values. The corollary to this statement is to minimize or prevent fraud.
3. To provide detailed information which can be used for income tax, sales tax and other types of required reporting by governmental units.
4. To use the information in making business decisions for future operations.

The discussion about an accounting system differs from a discussion about the production of financial statements. Producing periodic financial statements is not an ongoing requirement in the same context as recording transactions. The concept of recording is the foundation or framework for the rest. It would not be possible to compile accurate financial statements without the underlying accounting records.


2. What is the basic terminology of the accounting process or financial reporting?

The basic terminology in accounting involves having an understanding of the accounting equation of Assets = Liabilities + Equity. First, an understanding of asset, liability, equity, revenue and expense is critical to any higher level or ...

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Career Fair: Accountancy Presentation

You have been asked to speak at a career fair for high school students in your home town.
Specifically, you are making a presentation about your role as an accountant.

- Describe for the students the primary objectives of accounting.
- Explain the basic terminology of the accounting process or financial reporting.
- Explain how accounting has affected your personal life emphasizing professional ethics.
- Explain the role that technology has played in small business accounting.

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