Principles of Financial and Managerial Accounting –
Introduction to Core Concepts and Applications Lecture
Summary
Principles of financial and managerial accounting.
Unit 2 15% Role and purpose of accounting
Unit 3 20% Financial statements, and analyzing, charts
Unit 4 10% Budgeting cash flows, cash/credit transactions
Unit 5 10% Controlling cost and profits, budgets, c-v-p
Unit 6 25% Managerial accounting
Unit 7 20% Costing methodologies
Identify the issue, Gather information, Identified alternatives, Select the option that will most likely
result in the desired objective.
The balance sheet, Summary of the financial position of the company
The income Statement, Report of company performance over a particular period of time
The statement of cash flows, Shows net increase or decrease
Statement of returned Earnings, Identifies changes in accumulated earnings since day one
Articulation is the relationship of the statements
FASB Financial accounting standards board. Sets standards for publicly listed companies,Private
organization of seven full-time members. Gets its authority from the SEC.
GAAP Generally excepted accounting principles. Rules set by FASB in conjunction with SEC
GASB Governmental accounting standards board. Set the financial and accounting standards on the
state and local level following GAAP, Is a private non-governmental organization
SEC securities and exchange commission. Seeks to create a fair information environment for investors.
AICPA American Institute of certified public accountants. Administers certified public accountant exam.
IRS space internal revenue service sets and Administers tax law
IASB International accounting standards board. Set worldwide GAAP
Collecting, analyzing, and summarizing financial information
Analyze transactions, Record the effects of transactions, Summarize effects of transactions, Prepare
reports
Assets = liabilities + owner’s equity
Classified balance sheet distinguishes between current and long- term assets.
Assets cash, Accounts receivable, Inventory, buildings, equipment
Liabilities Account payable, mortgages payable, Taxes payable, unearned revenue payable
Owner’s equity capital stock Given by shareholders, Retained earnings, Money invested in the business
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, Financial statement notes fall into four general categories:
1. Summary of significant accounting policies
2. Additional information about the summary totals found in the financial statements
3. Disclosure of important information that is not recognized in the financial statements
4. Supplementary information required by the Financial Accounting Standards Board (FASB) or the
Securities and Exchange Commission
Horizontal analysis is year to year comparison
Vertical analysis is comparing two similar companies
Uncontrollable external factors driving sales include the following:
The business environment, which includes current government policies, tariffs between countries, the
status of the economy, demographics (characteristics of the population such as age, wealth, and family
status), and the state of technology
Customer needs and tastes with respect to the product or service being analyzed and other substitute
products
Intensity of the competition and possible barriers to market entry (barriers can include technology
copyrights, government contracts, reputation, or large sales volumes that provide economies of scale)
Seasonal cycles creating abrupt changes in sales demand due to holidays or weather patterns
Unexpected events such as droughts, hurricanes, and earthquakes
1. Long-run planning, which includes
1. strategic planning, and
2. capital budgeting.
2. Short-run planning, which includes
1. production and process prioritizing, and
2. operational budgeting (profit planning).
The managers inside the company use managerial accounting data in planning, controlling, and
evaluating business operations
Controlling involves the process of tracking actual performance
Evaluating involves analyzing results
In economics, this pattern of decreasing costs per unit as volume increases is known as an economy of
scale.
mixed costs are costs that contain both variable and fixed components.
Stepped costs increase with the level of activity but in steps instead of smoothly.
Over a reasonable range of expected sales or production activity (called the relevant range), a variable
cost remains the same per unit
A stepped fixed cost is one that remains the same for a substantial volume of activity and then increases
sharply when an activity threshold is reached.
Direct costs are costs that can be physically traced to a business unit or segment being analyzed.
This study source was downloaded by 100000900412927 from CourseHero.com on 01-11-2026 05:08:44 GMT -06:00
https://www.coursehero.com/file/141143879/Financial-and-Managerial-Accounting-D196docx/
Introduction to Core Concepts and Applications Lecture
Summary
Principles of financial and managerial accounting.
Unit 2 15% Role and purpose of accounting
Unit 3 20% Financial statements, and analyzing, charts
Unit 4 10% Budgeting cash flows, cash/credit transactions
Unit 5 10% Controlling cost and profits, budgets, c-v-p
Unit 6 25% Managerial accounting
Unit 7 20% Costing methodologies
Identify the issue, Gather information, Identified alternatives, Select the option that will most likely
result in the desired objective.
The balance sheet, Summary of the financial position of the company
The income Statement, Report of company performance over a particular period of time
The statement of cash flows, Shows net increase or decrease
Statement of returned Earnings, Identifies changes in accumulated earnings since day one
Articulation is the relationship of the statements
FASB Financial accounting standards board. Sets standards for publicly listed companies,Private
organization of seven full-time members. Gets its authority from the SEC.
GAAP Generally excepted accounting principles. Rules set by FASB in conjunction with SEC
GASB Governmental accounting standards board. Set the financial and accounting standards on the
state and local level following GAAP, Is a private non-governmental organization
SEC securities and exchange commission. Seeks to create a fair information environment for investors.
AICPA American Institute of certified public accountants. Administers certified public accountant exam.
IRS space internal revenue service sets and Administers tax law
IASB International accounting standards board. Set worldwide GAAP
Collecting, analyzing, and summarizing financial information
Analyze transactions, Record the effects of transactions, Summarize effects of transactions, Prepare
reports
Assets = liabilities + owner’s equity
Classified balance sheet distinguishes between current and long- term assets.
Assets cash, Accounts receivable, Inventory, buildings, equipment
Liabilities Account payable, mortgages payable, Taxes payable, unearned revenue payable
Owner’s equity capital stock Given by shareholders, Retained earnings, Money invested in the business
This study source was downloaded by 100000900412927 from CourseHero.com on 01-11-2026 05:08:44 GMT -06:00
https://www.coursehero.com/file/141143879/Financial-and-Managerial-Accounting-D196docx/
, Financial statement notes fall into four general categories:
1. Summary of significant accounting policies
2. Additional information about the summary totals found in the financial statements
3. Disclosure of important information that is not recognized in the financial statements
4. Supplementary information required by the Financial Accounting Standards Board (FASB) or the
Securities and Exchange Commission
Horizontal analysis is year to year comparison
Vertical analysis is comparing two similar companies
Uncontrollable external factors driving sales include the following:
The business environment, which includes current government policies, tariffs between countries, the
status of the economy, demographics (characteristics of the population such as age, wealth, and family
status), and the state of technology
Customer needs and tastes with respect to the product or service being analyzed and other substitute
products
Intensity of the competition and possible barriers to market entry (barriers can include technology
copyrights, government contracts, reputation, or large sales volumes that provide economies of scale)
Seasonal cycles creating abrupt changes in sales demand due to holidays or weather patterns
Unexpected events such as droughts, hurricanes, and earthquakes
1. Long-run planning, which includes
1. strategic planning, and
2. capital budgeting.
2. Short-run planning, which includes
1. production and process prioritizing, and
2. operational budgeting (profit planning).
The managers inside the company use managerial accounting data in planning, controlling, and
evaluating business operations
Controlling involves the process of tracking actual performance
Evaluating involves analyzing results
In economics, this pattern of decreasing costs per unit as volume increases is known as an economy of
scale.
mixed costs are costs that contain both variable and fixed components.
Stepped costs increase with the level of activity but in steps instead of smoothly.
Over a reasonable range of expected sales or production activity (called the relevant range), a variable
cost remains the same per unit
A stepped fixed cost is one that remains the same for a substantial volume of activity and then increases
sharply when an activity threshold is reached.
Direct costs are costs that can be physically traced to a business unit or segment being analyzed.
This study source was downloaded by 100000900412927 from CourseHero.com on 01-11-2026 05:08:44 GMT -06:00
https://www.coursehero.com/file/141143879/Financial-and-Managerial-Accounting-D196docx/
