Accountant 280

E1-1 Urlacher Company performs the following accounting tasks during the year.

______Analyzing and interpreting information.

______Classifying economic events.

______Explaining uses, meaning, and limitations of data.

______Keeping a systematic chronological diary of events.

______Measuring events in dollars and cents.

______Preparing accounting reports.

______Reporting information in a standard format.

______Selecting economic activities relevant to the company.

______Summarizing economic events.

Accounting is “an information system that identifies, records, and communicates the economic

events of an organization to interested users.”

Instructions

Categorize the accounting tasks performed by Urlacher as relating to either the identification

(I), recording (R), or communication (C) aspects of accounting

E1-2 (a) The following are users of financial statements.

______Customers ______Securities and Exchange Commission

______Internal Revenue Service ______Store manager

______Labor unions ______Suppliers

______Marketing manager ______Vice-president of finance

______Production supervisor

Instructions

Identify the users as being either external users or internal users.

(b) The following questions could be asked by an internal user or an external user.

______Can we afford to give our employees a pay raise?

______Did the company earn a satisfactory income?

______Do we need to borrow in the near future?

______How does the company’s profitability compare to other companies?

______What does it cost us to manufacture each unit produced?

______Which product should we emphasize?

______Will the company be able to pay its short-term debts?

Instructions

Identify each of the questions as being more likely asked by an internal user or an external user.

E1-3 Larry Smith, president of Smith Company, has instructed Ron Rivera, the head of the

accounting department for Smith Company, to report the company’s land in the company’s accounting

reports at...