Study notes for accounting 101 chapters 1-3, Freshman level

1.What is the objective of most business? To maximize profits. 2.Who are the normally included as the stakeholders of a business? Owners, employees, managers, customers, creditors and the government. 3.What is the role of accounting in business? Accounting is an information system that provides reports to stakeholders about the economic activities and conditions of a business. 4. What three sound principles form the foundation for ethical behavior? Avoid small ethical lapse. Focus on your long-term reputation …

…amount that should normally be reported on the balance sheet? Explain. No, the cash might have to be adjusted for 6.Is the balance listed for supplies on the trial balance, before the accounts have been adjusted, the amount that should normally be reported on the balance sheet, Explain. No, supplies have been used during the month. 7.Why are adjusting entries needed at the end of an accounting period? To bring the accounts up to date.