Accounting 100-Chapter 1 The Nature of Accounting

• the process
• of recording, summarizing,
• analyzing, and
• interpreting financial
• (money-related) activities
• to permit individuals and
• organizations to make
• informed judgments and
• decisions

an organization that operates with the objective of earning a profit

A sole proprietorship is a business owned by one person.

• A partnership is a form of business that
• is co-owned by two or more persons

• A corporation is a form of business that
• is owned by investors called stockholders

type of business organization that combines features of a corporation and those of a partnership or sole proprietorship

A service business performs services for customers to earn a profit.

• A merchandising business purchases goods produced by others and then
• sells these goods to customers

A manufacturing business produces a product to sell to its customers.

An asset is an item with money value that is owned by a business.