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Data (p. 2)
Reports such as financial statements,customer lists, and inventory records.
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Information (p. 2)
Data that have been organized, processed,and summarized.
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Knowledge (p. 2)
Information that is shared and exploited so that it adds value to an organization.
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AIS(Accounting Information System) (p. 3)
A transaction-processing system that captures financial data resulting from accounting transactions within a company
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Financial accounting (p. 5)
The area of accounting concerned primarily with the preparation and use of financial statements by creditors, investors, and other users outside the company.
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Managerial Accounting (p. 5)
The area of accounting concerned primarily with generating financial and nonfinancial information for use by managers in their decision-making roles within a company.
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External users (p. 5)
Stockholders, potential investors, creditors, government taxing agencies, regulators, suppliers, customers, and others outside the company.
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Internal users (p. 6)
Individual employees, teams,departments, regions, top management, and others inside the company—often referred to as managers.
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Planning (p. 6)
The development of both the short-term (operational) and long-term (strategic) objectives and goals of an organization and the identification of the resources needed to achieve them.
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Operational Planning (p. 6)
The development of short-term objectives and goals (typically, those to be achieved in less than one year).
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Strategic Planning (p. 6)
Addresses long-term questions of how an organization positions and distinguishes itself from competitors.
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Operating Activities (p. 6)
The day-to-day operations of a business
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Controlling Activities (p. 6)
The motivation and monitoring of employees and the evaluation of people and other resources used in the operation of the organization.
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Operations and production function (p. 7)
Produces the products or services that an organization sells to its customers.
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Marketing function (p. 7)
Involved with the process of developing, pricing,promoting, and distributing goods and services sold to customers.
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Finance function (p. 7)
Responsible for managing the financial resources of the organization.
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Human resource function (p. 7)
Concerned with the utilization of human resources to help an organization reach its goals.
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Decision Making (p. 9)
The process of identifying alternative courses of action and selecting an appropriate alternative in a given decision-making situation.
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Relevant costs (p. 10)
Costs which differ among alternatives.
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Sunk cost (p. 10)
Cost that have already been incurred
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Opportunity costs (p. 10)
The benefits forgone by choosing one alternative over another.
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Ethics programs (p. 12)
Company programs or policies created for the express purpose of establishing and maintaining an ethical business environment.
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