Accounting, a service activity, stakeholders, All parties interested in the financial health of a company, Internal users, who make decisions directly affecting the internal operations of the enterprise, External users, who make decisions concerning their relationship to the enterprise, Economic Entity, The business enterprise is viewed as a specific economic entity separate and distinct from its owners and any other business unit, Going Concern, A business will continue to operate “long enough to use its longest-lived asset”, unless there is evidence to the contrary., Unit of Measurement, the business use a common unit of measurement in accounting for there transactions., Accounting Period, Accountants prepare meaningful financial reports for ongoing business by dividing their lives into reporting intervals of equal length., Accrual Basis, Recognizes the effects of transactions and other events when they occur rather than only when cash or its equivalent is received or paid, Cash Basis, Recognizes changes in financial position and performance only when cash is received or paid.

chapter 1

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