Introductory Lesson

§ an economic entity

§ has the following goals:

Profit-Maximization

Resource-Optimization

Cost-Reduction
§ specificdepartmentsof the business working on specific functions or
roles

HUMAN RESOURCE FINANCE

PURCHASING ACCOUNTING

PRODUCTION MARKETING & SALES

§ language of the business

§ an activity that aims to provide quantitative information about

economic activities, primarily in financial nature that is intended to
be useful in making economic decisions
§ Owners and Investors
§ Manager
§ Lender
§ Supplier
§ Government External
§ Employee
§ Customers

*Stakeholders are individuals of entities who has interest in economic

performance of a business
*Stakeholder vs Stockholder
art of planning and managing resources and directing people to
efficiently run the business:
 Production Manager
 Marketing Manager
 Finance Manager
 Personnel Manager

Company using its resources at the least time, cost and effort

Company attaining its goal based on plans and strategies

§ Ownership
§ Capitalization
§ Life or Term of Existence
§ Management Structure
§ Profit Distribution
§ Reporting Requirements
§ Income Taxation
§ Liability to Third Party
CHECKPOINT
§ Textile Factory
§ Direct Seller
§ Bank
§ Sari-Sari Store
§ Barber Shop
§ Restaurant
§ Sardines Canning
§ Convenience Store
§ Business Entity Concept
§ Exchange Price or Cost Concept
§ Going Concern Concept
§ Accrual Concept
§ Objectivity Concept
§ Disclosure Concept