Study notes for accounting 101 chapters 1-3, Freshman level

1.What is the objective of most rail line?

To maximize profits.

2.Who are the ordinarily included as the stakeholders of a condescension?

Owners, employees, managers, customers, creditors and the government.

3.What is the role of explanation in business?

Accounting is an information system that provides reports to stakeholders about the scotch activities and conditions of a business.

4. What three sound principles form the foundation for honourable behavior?

Avoid small ethical lapse.

Focus on your long-term reputation

Expect to smart personal consequences for holding to an ethical position.

5. Distinguish between hidden accounting and public accounting.

Accountants employed by a business or not for profit are in backstage accounting.

Accountants who work for a fee are public.

6. Identify what the abbreviations FASB stands for and render how the FASB sets generally accepted accounting principles.

Financial Accounting Standard mesa which set GAAP allows for the comparison of financial performance and conditions crossways companies.

7. Lynda lyons is the owner of betting Delivery attend to. Recently, Lynda paid interest of $3500 on a personal loan of $60,000 that she used to begin the business. Should Fast Delivery Service Record the interest payment? Explain.

No, the business entity concept limits the accounting date to the directly related activities of the business.



A proprietorship would record the activites of the business only.

8. On April 18, Neece Repair overhaul extended an offer of $95000 for land that had been harmd for sale at $100,000. On April 25, Neece Repair Service accepted the sellers counteroffer of $97,500. Describe how Neece Repair Service should record the land.

Cost concept is the basis for entering the actual price of the sale, $97,500, into the accounting records for the land.

9. a) Land with an assessed value of $200,000 for property tax purposes is acquired by a business for...

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