2. Coming together is the beginning.
Keeping together is progress
Working together is success
- Henry Ford
American Automobile
Manufacturer
3. You and theWorld ofYou and theWorld of
AccountingAccounting
Chapter 1
4. Learning ObjectivesLearning Objectives
īYou will be able to :
âĻ Describe how personal skills, values and
lifestyle goals affect career decisions.
âĻ Find information about a variety of careers.
âĻ Identify career opportunities in the
accounting fields.
âĻ Set career goals.
5. Learning Objectives (cont.)Learning Objectives (cont.)
âĻ Describe types of businesses and
organizations that hire accountants.
âĻ Compare for profit businesses and non-profit
organizations.
âĻ Define the accounting terms introduced in
this chapter.
6. Exploring the Real World ofExploring the Real World of
BusinessBusiness
īThe World Wildlife Fund
âĻ A non-profit organization, works to save
endangered species.
âĻ Employs accountants, writers, fund raisers,
and many other professionals who care about
wildlife and their habitats.
Review the website:
http://www.worldwildlife.org
7. What do you think?What do you think?
1.What job skills or interest do you think
you would need to work for an
organization like World Wildlife Fund?
2.What kind of interest do you think would
attract someone to such an organization?
9. What Youâll LearnWhat Youâll Learn
īHow personal interest and skills, values
and lifestyle goals affect career decisions
īWhere to find information on possible
careers.
īHow to set career goals.
11. Job vs. CareerJob vs. Career
īA job is simply work for pay
īA career is built on a foundation of
âĻ Interest
âĻ Knowledge
âĻ Training and
âĻ Experience
12. Access Your Career VisionAccess Your Career Vision
īWhat are your personal interest and
skills?
īWhat are you values, and how will they
affect your career?
īWhat lifestyle interest you?
īHow will your personality affect a career
choice?
13. Your Interest, Skills, and TraitsYour Interest, Skills, and Traits
īSkills are activities that you do well
âĻ Are you good at math?
âĻ Do you write well?
âĻ Are you creative?
âĻ Do you like to meet lots of people
âĻ Do you enjoy building things
14. Skills & Traits Careers Example
Creative Thinking Fine arts and humanity, actor
artist or musician
Knowing how to learn Training or Teaching
Responsibility Health ârelated careers
Friendliness Hospitality and recreation
careers
Honesty Child care worker, family and
consumer science worker
Decision making Financial planner, accountant
Analytical Construction careers
Adaptability Public service careers
Self control Entrepreneur or manager
Self-esteem Communication and media
15. ValuesValues
īValues are the principle you live by and the
benefits that are important to you.
âĻ Responsibility
âĻ Achievement
âĻ Relationships
âĻ Compassion
âĻ Courage
âĻ Recognition
īMany people share the same values, but how
they apply them is unique to each person.
16. Lifestyle GoalsLifestyle Goals
īLifestyle is how you use you time,
energy and resources.
âĻ Whatâs really important to you?
âĻ Do you want to go for the big bucks?
âĻ Do you want to live in a big city with endless
activities or a small town where everybody
knows your name
âĻ Do you want to work with a group of people,
or do you prefer working solo?
17. Personality TraitsPersonality Traits
īPersonality â a set of unique qualities
that makes us different from other
people.
īWhat is you personality. Are you
âĻ Confident
âĻ Friendly
âĻ Dependable
âĻ Funny
âĻ Sympathetic
18. Personal Career Profile Form
Name Date Career
Your Values Career Values
Your Interest Career Duties and Responsibilities
Your Personality Personality Type Needed
Skills and Aptitudes Skills and Aptitude Required
Education/Training Acceptable Education/Training Required
19. Research the PossibilitiesResearch the Possibilities
īGuidance counselor can help you identify the
things you like to do. One way is through
personal interest test.
īNetworking is a way to find out about
particular careers by asking people to share
information and advice.
īPrint material about every career can be found in
your public library.
īThe Internet is a great source of educational and
career information
īProfessional organization are groups of people
with common career interest.
20. Set Career GoalsSet Career Goals
īMap out a plan
īEducation
īOn-the-Job Training
īInternships
21. Steps to Setting Career GoalsSteps to Setting Career Goals
1. Decide on a long-term goal.
2. Decide on actions that will lead to the
long-term goal.
3. Take action!
4. Diversify your skills
5. Realize the long-term goal.
22. A Matter of EthicsA Matter of Ethics
Padding a resume
Part of landing a great job is
putting together a resume
that effectively represents
your skills and background.
Imagine that BMW has
opened a new regional
headquarters in your area.
You would like to work for
BMW as a payroll clerk, but
you are afraid you donât have
the right qualifications. A
friend suggests that you
âchangeâ your resume to
make yourself look better.
ī Ethical Decision Making:
What are the ethical
issues?
What are the alternatives?
Who are the affected
parties?
How do the alternative
effect the parties?
What would you do?
24. What Youâll LearnWhat Youâll Learn
īThe variety of career opportunities
available to accountants.
īThe type of businesses and organizations
that hire accountants
26. The Changing HorizonThe Changing Horizon
īAn accountant handles a broad range of
responsibilities, make business decisions, and
prepares and interprets financial reports.
īFor-profit businesses operate to earn
money for their owners.
īNot-for-profit organizations operate for
the greater good. Their goal is balancing
their income with expenses. Their income
comes from donations and tax dollars.
27. EmploymentEmployment
īAccounting clerk â an entry level job
usually performing one or two accounting
task.
īCertified public accountant pass a
national test and meet specific experience
and education standards to become
âcertifiedâ to practice accounting.
īYou might choose to work as a financial
consultant in a large company or work for a
public accounting firm and provide
accounting services for their clients
29. Learning ObjectiveLearning Objective
īYou will be able to:
âĻ Describe the role of profit, risk-taking, and
the entrepreneur in the US economy.
âĻ Describe the difference among service,
merchandising, and manufacturing businesses.
âĻ Compare the sole proprietorship,
partnership, and corporate forms of business
organization.
âĻ Describe the purpose of accounting
30. Learning Objectives (cont.)Learning Objectives (cont.)
âĻ Explain the difference between financial and
management accounting.
âĻ Describe the three basic assumption that
underlie accounting principles.
âĻ Define the accounting terms introduced in
this chapter.
31. Exploring the Real World ofExploring the Real World of
BusinessBusiness
īHueyâs Athletic Network (HAN)
âĻ Uses aquatic therapy to help injured athletes
rebuild body strength
âĻ Provides personal training and consulting not
only to sport star, but also to entertainers
and weekend warriors who want to stay fit.
Review the website:
www.lahuey.com
32. What do you think?What do you think?
1. What knowledge and special skills do
you think Lynda Huey needed to start
and manage her business?
2. What makes an entrepreneur
successful?
34. What Youâll LearnWhat Youâll Learn
īProfit and risk-taking.
īThe free enterprise system.
īStarting and running your own business.
īThree types of business operations.
īThree forms of business organization.
35. Key TermsKey Terms
īFree enterprise
system
īProfit
īLoss
īEntrepreneur
īCapital
īService business
īMerchandising
business
īManufacturing
business
īSole proprietorship
īPartnership
īCorporation
īCharter
36. The Environment of BusinessThe Environment of Business
īFree enterprise system
âĻ People are free to produce goods and
services as they choose
âĻ Individuals are free to use their money as
they wish:
ī Spend it,
ī Invest it,
ī Save it, or
ī Donate it.
âĻ Business owners must compete to attract
customers to continue operating.
37. The Environment of BusinessThe Environment of Business
īProfit â the amount of money earned
over and above the amount spent to
operate the business
īLoss â spending more money on
business expenses than is earned.
īA business has to do two things to
survive:
âĻ It must operate at a profit.
âĻ It must attract and keep an individual willing
to take risk to run it.
38. The Environment of BusinessThe Environment of Business
īThe need for Profit
âĻ You must pay
ī Raw material
ī Equipment
ī Employees
ī Utilities and rent
īThe need for a Risk-Taker
âĻ People play different roles
ī Investors provide the money
ī Employees provide the labor
ī Managers handle supervision and planning
ī Entrepreneurs transform ideas for products and
services into real-world businesses
39. Entrepreneurship:Who Me?Entrepreneurship:Who Me?
Pros Cons
ī You are your own boss.
ī You create opportunities for
earning money.
ī You create and control your
work schedule.
ī You choose the people you
serve.
ī You select the people who
work with you.
ī You benefit from the rewards
of your own hard work.
ī You choose your own work
hours.
ī You probably need to work long
hours.
ī You lose the security of steady
wages and medical benefits an
employer provides.
ī You market your own services
or products.
ī You pay your own operating
expenses.
ī You must be motivated and
energetic each day
ī You face the possibility of losing
money.
40. Traits of the EntrepreneurTraits of the Entrepreneur
īEntrepreneur are aware of their
environment
ī No ice cream shop
ī Does the community want one?
īEntrepreneur evaluate alternatives
ī Customer preference
ī Architect plans
ī Accountantâs guidance
īEntrepreneurs seek the best solutions
ī Only used appliances are within budget guidelines
īEntrepreneurs turn ideas into action
ī Ben& Jerryâs is a worldwide producer of ice cream and
frozen yogurt
41. Types of Business OperationsTypes of Business Operations
īThere are three types of business that
operate for profit:
âĻ Service business
âĻ Merchandising business
âĻ Manufacturing business
īEach type of business needs money to
begin and maintain operations
īMoney supplied by investors, banks, or
owners of a business is called capital.
42. Forms of Business OrganizationForms of Business Organization
īThere are there forms of business
organization
âĻ Sole Proprietorship
âĻ Partnership
âĻ Corporation
43. Sole ProprietorshipSole Proprietorship
īBusiness owned by one person.
īThe oldest and most common form of
ownership
īThe success or failure of the business
depends heavily on the efforts and talents of
the owner.
Advantages Disadvantages
Easy to set up Limited expertise
All profits go to owner Hard to raise money
Owner has total control Owner has all the risks
Few regulations to follow Hard to attract talented employees
44. PartnershipPartnership
īBusiness owner by two or more persons;
called partners
īPartnerships are formed when the need
for capital is greater than the amount of
money one person can invest.
Advantages Disadvantages
Easy to start Conflicts between partners
Skills and talents are pooled Profits must be shared
More money available Owners share all risks
45. CorporationCorporation
īBusiness organization that is recognized
by law to have a life of its own.
īMust get permission from the state to
operate.
Advantages Disadvantages
Easier to raise money Costs more to start up
Easy to expand Complex to organize
Easy to transfer ownership More regulations
Losses limited to investments Higher taxes
46. Corporation (cont.)Corporation (cont.)
īTo raise money, shares of stock are sold
to hundreds or even thousands of people.
īThese shares represent invest in and
ownership of the corporation.
īShareholders/Stockholder are the legal
owners of a corporation
*************
Regardless of the form, all businesses share common
financial characteristics and methods for recording
and reporting financial charges.
48. What youâll learnWhat youâll learn
īHow the accounting system works.
īWho uses financial accounting reports.
īWho uses managerial accounting reports.
īHow accounting is used to help make
business decisions.
īWhat assumptions provide the
foundation for accounting systems.
49. Key TermsKey Terms
īAccounting system
īManual accounting
system
īComputerized
accounting system
īGAAP
īFinancial reports
īFinancial accounting
īManagement
accounting
ībusiness entity
īAccounting period
īGoing concern
50. The Accounting SystemThe Accounting System
īThe accounting system is designed to
collect, document and report on financial
transactions affecting the business.
īIn a manual accounting system the
accounting is processed by hand.
īIn a computerized accounting
system the financial information is
recorded by entering it in the computer.
51. The Accounting System (cont.)The Accounting System (cont.)
īAll accountants used the same set of rules
to prepare their reports.
īGAAP is also known as generally accepted
accounting principles.
īAccounting principles provide a way to
communicate financial information in a form
understood by those interested in business
operations
īFinancial reports are summarized
information about the financial status of a
business
52. Input Processing Outputs
Source Document Tasks Financial and
âĸChecks âĸAnalyzing Management
âĸInvoices âĸClassifying Accounting Reports
âĸSales Slips âĸRecording âĸFinancial condition
âĸReceipts âĸResults of operation
âĸInvestment by and
distributions to owners
How the Accounting System Works
53. Using Accounting Reports forUsing Accounting Reports for
Making Business DecisionsMaking Business Decisions
īPurpose of accounting
âĻ Provide financial information about a business
or not-for-profit organization
âĻ Provide information to individual in order to
make decisions.
īThese two groups use accounting reports
âĻ Individuals outside the business who have an
interest in the business
âĻ Individuals inside the business
54. Using Accounting Reports forUsing Accounting Reports for
Making Business DecisionsMaking Business Decisions
īFinancial Accounting focuses on reporting
information to external users.
âĻ The reports are prepared using GAAP for
ī Individuals or institutions that loan money to a
business, to determine if the business is able to
repay the loan
ī Local, state and federal government agencies for
taxing purposes.
ī Workers, consumers, union leaders and
competition are interested in the businesses
performance.
55. Using Accounting Reports forUsing Accounting Reports for
Making Business DecisionsMaking Business Decisions
īManagement accounting focuses on
reporting information to management.
īReferred to as accounting for internal users
īReports are prepared for managers to make
decision regarding:
âĻ Purchasing,
âĻ Hiring,
âĻ Production,
âĻ Payments,
âĻ Sales, and
âĻ Collections.
56. Accounting AssumptionsAccounting Assumptions
īThese generally accepted accounting
principles are based on these assumptions.
âĻ Business entity
ī A business is a separate entity and exist separate of itâs
owners personal holdings
âĻ Accounting period
ī For reporting purposes, the life of a business is divided
into specific periods of time.
ī It can be a month, a quarter, or most commonly a year.
âĻ Going concern
ī Accountants assume the business has the ability to
survive and operate indefinitely.
ī It is expected to continue.
57. A Matter of EthicsA Matter of Ethics
Becoming an
Entrepreneur
Imagine that youâve been working for
a local day-care center for several
years. You attend a company
meeting to discuss new ideas on
improving day care. Several new
services are discussed that would
help your center stand out from
itâs competition. You think that this
is a great opportunity for you to
become and entrepreneur â by
opening your own day-care center
offering the new services discussed
at the meetings
Ethical Decision Making
What are the ethical issues?
What are the alternatives?
Who are the affected parties?
How do the alternatives
affect the parties?
What would you do?
Editor's Notes
Accounting plays a vital role in the day-to-day activities of every business. Accounting records and reports help businesses operate efficiently and profitably by keeping track of how much is earned and how much is spent.
Accounting is so much a part of the business world that much of its terminology has become a part of our everyday language.
Please go to the World Wildlife Fund website. Browse and Review the site for 15 minutes, paying close attention to services and careers.
ACTION: set timer
Why its important
A successful career begins with identifying your interest and skills and putting them to work for you. As consumers, we buy goods from merchandising businesses daily. Understanding the nature of these transaction are key to accounting for a merchandising business.
Given this information, what might you want you career to be? Are do you just want a job?
Before choosing a career you need to do a little soul-searching. The more you know about yourself, the easier it will be to make career choices.
ACTION: Students should go to this website: www.educationplanner.com and click on Career assessment and take the quiz.
This should take approximately 10-15 minutes.
Your are more likely to enjoy a career that uses you individual interest skills and traits.
Everyone has different skills and abilities â itâs the combination that gives you a unique selling point
How many of these traits do you have? Make a list. It will come in handy when you consider careers that interest you.
Being responsible means being dependable and taking positive actions, like showing up on time for work or honoring a commitment.
You value achievement if you want to be a success in whatever you do, but it goes a little farther than wanting it also involves taking initiative.
If you especially value interaction with friends and family, relationships are important to you.
With compassion you care deeply about people animals or special causes.
Courage is not just being brave in the face of physical danger, it is also the ability to overcome other fears. For example it takes courage to make a speech in front of the whole classroom
If acknowledgement and appreciation of your work is important to you, then you value recognition.
Make a list of how youâd like to spend your time, energy and resources. These are your lifestyle goals. Try to focus on careers that closely match them.
As you collect information about yourself, youâll want to complete a personal career profile. Use this profile to help you evaluate whether the careers that youâre considering match your skills, interest, values and personality.
ACTION: hand out Personal Career Profile Form â Refer student to page 10 for help in completing the form.
ACTION: Hand out Personal Career Profile Form
Use this profile to help you evaluate whether the career youâre considering match your skills, interest, values, and personality.
Accounting Flashbacks --- The Inca Empire, which spanned the west coast of South America throughout the 11th â 14th centuries, used knotted cords of different lengths and colors called quipi to keep accounting records.
Why its important --- Explore all the careers available in accounting. You wouldnât want to miss a great opportunity just because you didnât know it existed.
HOMEWORK: Problem 1-5 Researching Public Accounting Firms --- Page 17
Surf the World Wide Web or conduct research in the library to find information about the âbig Fourâ accounting firms. Create a table of information about each firm and the services they provide.
Review the Key Concepts â Chapter 1 Summary on Page 19
Please go to the Hueyâs Athletic Network website. Browse and Review the site for 15 minutes, paying close attention to services and careers.
ACTION: set timer
Why is it important --- in order to participate in the world of business, youâll want to understand how businesses are formed, organized and operated.
A business must operate at a profit and have some willing to take the risk for it.
One measure of success in a business operation is the amount of profit it earns.
There are many benefits of starting and running your own business, but there are also drawbacks to consider.
A service business provides a needed service for a fee. Examples are travel agencies, beauty salons, movers, insurance company and realtors
A merchandising business buys finished products and resales them to individual or businesses, such as Department Stores and supermarkets
A Manufacturing business buys raw material and transform them into finished products. Ranging from shipbuilders to bakeries.
Why its important ---- understanding accounting systems is the key to understanding business.
Each business sets up an accounting systems according to its specific needs, but all businesses follow GAAP
Activity --- Computing in the business world â page 35
Suppose you are opening a 1,000 square foot baseball card store in a shopping center. You have signed a lease that requires you to pay a monthly rent of $1,75 per square foot, plus 5% of your gross annual sales. What is the total amount of rent you will pay in one year if you have sales of $85,000?
THE ANSWER = $25,250
Review Chapter 2 Summary â Key concepts on page 37
HOMEWORK: Problem 2-4 Indentify Types of Business Page 40, Problem 2-6 Understanding Business Operations, and Problem 2-7 Categorizing Forms of Business Organizations Page 41