Lesson 1 : Understanding Finance
First Semester — 1st Quarter
Definition And Concept Of Finance Financial Resources, Investments, and
- Finance deals with and is strictly Expenditures
governed by financial facts and Financial Resources - refer to the funds of a
truths which in turn are based on business which are provided by the owner or
accepted industry and professional by the creditors
standards Financial investments - are resources that
- Finance is also considered an art. are expected to provide income and achieve
The different financial services appreciation or growth of the business.
continue to change and develop as Financial expenditures - may cover the
the operations of business operating expenditures and the capital
organizations become more expenditures
complicated Operating expenditures - are period
costs of the business that include business
Application of Economic and Accounting expenses such as salaries, electricity and
Concepts and Principles water, traveling expenses, and the like
Economics - as a social science, is concerned Capital expenditures - involve the
with the efficient utilization of scarce acquisition or construction of buildings,
resources to satisfy human needs and wants. machinery, processing plant, and land
Economic variables such as price, demand,
supply, income, and expenditures are the Areas Of Finance
focus of the study in the development of Private Finance - management of financial
economic theories and principles resources of private individuals
Accounting - is the professional practice of Public Finance - allocation of government
recording business transactions and deals income generated either from taxation or
with the preparation of financial statements, borrowings and the government expenditure
all involving these economic variables. The based on the approved national and local
recording process follows the Philippine appropriation or
Financial Reporting Standards (PFRSS) budget. Public finance is also
which is in accordance with international termed as fiscal administration
standards Personal finance - is a sub-category
of private finance which is directed towards
System, Structure, and Process the management of personal resources of an
The term system connotes that the individual person
financial activities of the business Business Finance - an area of finance that
are properly coordinated with the whole focuses on the handling and management of
structure of that business. Based on this, financial resources of a business
clear financial processes direct the necessary organization
resources of the business towards the
attainment of the ultimate objective
First Semester — 1st Quarter
Definition And Concept Of Finance Financial Resources, Investments, and
- Finance deals with and is strictly Expenditures
governed by financial facts and Financial Resources - refer to the funds of a
truths which in turn are based on business which are provided by the owner or
accepted industry and professional by the creditors
standards Financial investments - are resources that
- Finance is also considered an art. are expected to provide income and achieve
The different financial services appreciation or growth of the business.
continue to change and develop as Financial expenditures - may cover the
the operations of business operating expenditures and the capital
organizations become more expenditures
complicated Operating expenditures - are period
costs of the business that include business
Application of Economic and Accounting expenses such as salaries, electricity and
Concepts and Principles water, traveling expenses, and the like
Economics - as a social science, is concerned Capital expenditures - involve the
with the efficient utilization of scarce acquisition or construction of buildings,
resources to satisfy human needs and wants. machinery, processing plant, and land
Economic variables such as price, demand,
supply, income, and expenditures are the Areas Of Finance
focus of the study in the development of Private Finance - management of financial
economic theories and principles resources of private individuals
Accounting - is the professional practice of Public Finance - allocation of government
recording business transactions and deals income generated either from taxation or
with the preparation of financial statements, borrowings and the government expenditure
all involving these economic variables. The based on the approved national and local
recording process follows the Philippine appropriation or
Financial Reporting Standards (PFRSS) budget. Public finance is also
which is in accordance with international termed as fiscal administration
standards Personal finance - is a sub-category
of private finance which is directed towards
System, Structure, and Process the management of personal resources of an
The term system connotes that the individual person
financial activities of the business Business Finance - an area of finance that
are properly coordinated with the whole focuses on the handling and management of
structure of that business. Based on this, financial resources of a business
clear financial processes direct the necessary organization
resources of the business towards the
attainment of the ultimate objective
