Question

Identify several ways in which you currently useaccounting information in your life as a student. Also identifyseveral situations in which, while you are still a student, youmight be required to supply financial information about yourself toothers.

2. Users of Accounting Information

Boeing Company is the largest manufacturer of commercialaircraft in the United States and is a major employer in Seattle,Washington. Explain why each of the following individuals ororganizations would be interested in financial information aboutthe company.

a.California Public Employees RetirementSystem, one of the world’s largest pension funds.

b.China Airlines, a rapidly growing airlineserving the Pacific Rim.

c.Henry James, a real estate investorconsidering building apartments in the Seattle area.

d.Boeing’s management.

e.International Association of Machinists andAerospace Workers, a labor union representing many Boeingemployees.

3. What Is Financial Reporting?

A major focus of this course is the process of financialreporting.

a.What is meant by the term financialreporting?

b.What are the principal accounting reportsinvolved in the financial reporting process? In general terms, whatis the purpose of these reports?

c.Do all business entities engage in financialreporting? Explain.

d.How does society benefit from the financialreporting process?

4. Generally Accepted Accounting Principles

Generally accepted accounting principles play an important rolein financial reporting.

a.What is meant by the phrase generallyaccepted accounting principles?

b.What are the major sources of theseprinciples?

c.Is there a single comprehensive list ofgenerally accepted accounting principles? Explain.

d.What types of accounting reports are preparedin conformity with generally accepted accounting principles?