1. Identify several ways in which you currently use accounting information in your life as a student. Also identify several situations in which, while you are still a student, you might be required to supply financial information about yourself to others.

2. Users of Accounting Information

Boeing Company is the largest manufacturer of commercial aircraft in the United States and is a major employer in Seattle, Washington. Explain why each of the following individuals or organizations would be interested in financial information about the company.

a.California Public Employees Retirement System, one of the world’s largest pension funds.

b.China Airlines, a rapidly growing airline serving the Pacific Rim.

c.Henry James, a real estate investor considering building apartments in the Seattle area.

d.Boeing’s management.

e.International Association of Machinists and Aerospace Workers, a labor union representing many Boeing employees.

3. What Is Financial Reporting?

A major focus of this course is the process of financial reporting.

a.What is meant by the term financial reporting?

b.What are the principal accounting reports involved in the financial reporting process? In general terms, what is the purpose of these reports?

c.Do all business entities engage in financial reporting? Explain.

d.How does society benefit from the financial reporting process?

4. Generally Accepted Accounting Principles

Generally accepted accounting principles play an important role in financial reporting.

a.What is meant by the phrase generally accepted accounting principles?

b.What are the major sources of these principles?

c.Is there a single comprehensive list of generally accepted accounting principles? Explain.

d.What types of accounting reports are prepared in conformity with generally accepted accounting principles?