Accounting consist of three basic activities - it identifies, records, and Communications the economic events of an organization to interested users.
Identification is identify economic events (transactions).
Recording determine are record, classify, and summarize.
Communication for prepare accounting reports and analyze and interpret for users.
Internal users of accounting information are managers who plans, organize, and run the bussiness. These include marketing managers, production supervisors, finance directors, and company officers.
External users of accounting information are investors and creditors.
The Basic Accounting Equation
Assets = Liabilities + Equity
Assets are resource a bussiness owns. The bussiness uses its assets in carrying out such activities as productions and sales.
