Professional Documents
Culture Documents
Financial & Managerial Accounting
Financial & Managerial Accounting
Financial &
& Managerial
Managerial
Accounting
Accounting
The Basis for Business Decisions
TWELFTH EDITION
Williams
McGraw-Hill/Irwin
Haka
Bettner
Meigs
Chapter
McGraw-Hill/Irwin
ACCOUNTING:
Information for Decision Making
The
accounting
process
Economic
activities
Actions
(decisions)
McGraw-Hill/Irwin
Accounting
links decision
makers with
economic
activities and
with the results of
their decisions.
Accounting
information
Decision
makers
Types
Types of
of Accounting
Accounting Information
Information
Financial
Tax
Managerial
McGraw-Hill/Irwin
Information
Information System
System
Information
Information
Users
Users
Investors
Investors
Creditors
Creditors
Managers
Managers
Owners
Owners
Customers
Customers
Employees
Employees
Regulatory
Regulatory
agencies
agencies
-SEC
-SEC
-IRS
-IRS
-EPA
-EPA
McGraw-Hill/Irwin
Cost
Cost&&Revenue
Revenue
Determination
Determination
Job
Jobcosting
costing
Process
Processcosting
costing
ABC
ABC
Sales
Sales
Assets
Assets&&
Liabilities
Liabilities
Plant
Plantand
and
equipment
equipment
Loans
Loans&&equity
equity
Receivables,
Receivables,
payables
payables&&cash
cash
Cash
CashFlows
Flows
From
Fromoperations
operations
From
Fromfinancing
financing
From
Frominvesting
investing
Decision
DecisionSupport
Support
CVP
CVPanalysis
analysis
Performance
Performance
evaluation
evaluation
Incremental
Incremental
analysis
analysis
Budgeting
Budgeting
Capital
Capital
allocation
allocation
Earnings
Earningsper
per
share
share
Ratio
Ratioanalysis
analysis
Basic
Basic Functions
Functions of
of an
an Accounting
Accounting
System
System
Interpret
and record
business
transactions.
Payment
Car
McGraw-Hill/Irwin
Basic
Basic Functions
Functions of
of an
an Accounting
Accounting
System
System
Interpret
and record
business
transactions.
McGraw-Hill/Irwin
Classify
similar
transactions
into useful
reports.
Summarize
and
communicate
information to
decision
makers.
Objectives
Objectives of
of External
External Financial
Financial
Reporting
Reporting
The
Theprimary
primaryexternal
external users
usersof
of financial
financialinformation
informationare
are
investors
investorsand
and creditors.
creditors.
(Specific)
Objectives
of
Financial
Reporting
Objectives
Objectives of
of External
External Financial
Financial
Reporting
Reporting
Balance Sheet
Income Statement
Statement of Cash Flows
McGraw-Hill/Irwin
The primary
financial
statements.
Financial
Financial Statements:
Statements:
AALens
Lensto
toView
View Business
Business
Fi
i
c
n
na
ep
R
al
g
n
i
t
or
Financial
Statements
Fin
anc
ial
Re
McGraw-Hill/Irwin
por
ting
Characteristics
Characteristics of
of Externally
Externally
Reported
Reported Information
Information
AAMeans
Meansto
to
an
anEnd
End
Usefulness
Usefulness
Enhanced
Enhancedvia
via
Explanation
Explanation
Broader
Broader than
than
Financial
Financial
Statements
Statements
Based
Basedon
on
General
General Purpose
Purpose
Assumption
Assumption
Historical
Historical in
in
Nature
Nature
Results
Resultsfrom
fromInexact
Inexactand
and
Approximate
ApproximateMeasures
Measures
McGraw-Hill/Irwin
Internal
Internal Users
Users of
of Accounting
Accounting
Information
Information
Board of Directors
Chief Executive Officer
Chief Financial Officer
Vice Presidents
Business Unit Managers
Plant Managers
Store Managers
Line Supervisors
McGraw-Hill/Irwin
T y p ic a l S im p le O r g a n iz a tio n C h a r t
B o a rd o f
D ir e c t o r s
(O w n e rs )
C h ie f E x e c u t iv e
O ffic e r
(C E O )
B u s in e s s U n it
M anager
P la n t
M anager
P la n t
M anager
P la n t
A c c o u n ta n t
P la n t
A c c o u n ta n t
McGraw-Hill/Irwin
V .P . H u m a n
R e s o u rc e s
V .P . In f o rm a tio n
S e r v ic e s
C h ie f F in a n c ia l
O ffic e r (C F O )
Objectives
of
Managerial
Reporting
McGraw-Hill/Irwin
Characteristics
Characteristics of
of Management
Management
Accounting
Accounting Information
Information
Timeliness
Timeliness
AAMeans
Meansto
to
an
anEnd
End
Identify
Identify
DecisionDecisionMaking
Making
Authority
Authority
Measures
Measuresof
of
Efficiency
Efficiencyand
and
Effectiveness
Effectiveness
Oriented
Oriented
Toward
Toward
Future
Future
McGraw-Hill/Irwin
Integrity
Integrity of
of Accounting
Accounting Information
Information
Institutional Features
Generally Accepted Accounting Principles (GAAP)
Financial Accounting Standards Board
Securities and Exchange Commission
Internal Control Structure
Audits
McGraw-Hill/Irwin
Integrity
Integrity of
of Accounting
Accounting Information
Information
Professional Organizations
American Institute of Certified Public Accountants
Institute of Management Accountants
Institute of Internal Auditors
American Accounting Association
McGraw-Hill/Irwin
Integrity
Integrity of
of Accounting
Accounting Information
Information
Competence, Judgment and Ethical Behavior
Certified Public Accountants (CPAs)
Certificate in Management Accounting (CMA)
Certificate in Internal Auditing (CIA)
Code of Professional Conduct
CP
A
McGraw-Hill/Irwin
End
End of
of Chapter
Chapter 11
McGraw-Hill/Irwin