Accounting for decision makers C213 WGU |504 Questions and Answers(A+ Solution guide)

1. Prepare 2. Analyze 3. Gather 4. Make decisions 5. Implement 6. Observe. - Accounting steps. Inside, Internal - Managerial info is inside or outside the business? True. Financial accounting is only outside. Managerial accounting can be inside AND outside. - True or false, managerial accounting uses BOTH managerial and financial accounting? Outside, External, includes lenders and investors - Financial is inside or outside the business? Balance sheet, income statement, and statement of cash flows - The financial statement includes what 3 documents Balance Sheet - Point in time, Assets (resources) and liabilities (obligations) Income Statement - Period of time (usually 1 year), amount of profit made Statement of Cash flows -Period of time, where money came from, and where it went. Inflow and outflow of cash (Cash Flows). Change in money for the period. Balance sheet equation -Assets= liabilities + equity Revenue equation - Net income=Revenue - Expenses Operating, investing, and financial activities - The statement of cash flows includes what three activitiesFASB: Financial accounting standards. Private, no government involvement. It is a public process, includes individuals experienced in business and accounting (7 members). - The decision makers in the U.S. (accounting rules) GAAP: General accepted accounting principles - Developed by accounting rule makers. No Legal authority.