E1-1 Urlacher Company performs the following accounting tasks during the year. Communicates-Analyzing and interpreting information.
Identifies-Classifying economic events.
Communicates-Explaining uses, meaning, and limitations of data. Records-Keeping a systematic chronological diary of events.
Records-Measuring events in dollars and cents.
Communicates-Preparing accounting reports.
Recording-Reporting information in a standard format.
Identify-Selecting economic activities relevant to the company. Communicates-Summarizing economic events.
E1-2 (a) The following are users of financial statements.
External-Customers External-Securities and Exchange Commission External-Internal Revenue Service Internal- Store manager External-Labor unions External-Suppliers
Internal-Marketing manager Internal-Vice-president of finance Internal-Production supervisor
(b) The following questions could be asked by an internal user or an external user. Internal-Can we afford to give our employees a pay raise?
External-Did the company earn a satisfactory income?
Internal-Do we need to borrow in the near future?