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This module outlines the fundamental aspects of accounting, defined as the process of identifying, measuring, and communicating financial information for informed decision-making. Key users of accounting information include owners, stockholders, suppliers, customers, bankers, and government entities. Accountants ensure the accuracy and timeliness of financial reports. The primary financial reports discussed are the Income Statement and Balance Sheet, which capture profitability, net income, revenues, and expenses, essential for managing and understanding business performance.
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Women of Courage Accounting Module 2011
What is accounting • Accounting is the process of identifying, measuring and communication the financial information about the business so good decisions can be made. • People who use accounting information are: • Owners • Stockholders • Suppliers • Customers • Bankers • Government • Accountants make sure the financial information is accurate and provided to users in a timely and organized manner • The primary accounting reports are: • Income Statement • Balance Sheet
Financial Reporting - Profit • Net Income = Revenue – Expenses • Revenues are what is received from customers for the good or service provided • Selling price x quantity sold • Expenses: • Cost of goods sold (To make the product) • Operating expenses (To run the business as a whole)
