Jamal Ali

Week 2 ACCG106 Homework

Introduction to business accounting
1-3
How is merchandising business different from a manufacturing business? How
are the two types of business the same?
Merchandising business differs from a manufacturing business as merchandising
business purchase supplies for resale to their customers however manufacturing
business manufacture their own supplies and sell these their products directly to their
customers.
1-6
Describe the factors affecting the business environment and the impact of each of
these factors.
Factors affecting the business environment may include regulatory issues in regards to
the well being of employers. Issues such as non ergonomic furniture incorrect lighting,
temperature may all contribute to how efficient employers work and the overall business
environment.
1-9
Given what you have learned from this chapter , how would you define
accounting?
In this chapter accounting is not only about managing the finance of a business but also
understanding different types of business, how a business works. Accounting is also
about critical thinking and making the correct decisions.

1-13
How do financial accounting reports help external users?
Financial accounting reports help external users as they allow users to identify, measure,
record and summaries important information about the activities of a business. Financial
reports are also helpful for investors, managers and the public to keep interest in the
business.

Jamal Ali
1-24
Why is it important to evaluate the credibility of source of information?
It is important to evaluate the credibility of source information because of the disastrous
consequences that may arise. A business financial statements should convey correct
information about the business to internal and external users in order the facilitate
decision making. For this purpose it is important that accountants maintain high ethical
standards.
1-26
Describe the stages of problem solving. What pitfalls might you encounter at each
stage?
The stages of solving problems is a systematic approach that is necessary to organise
the problem and to decide on a solution the the problem. Stages include recognising the
problem, identifying alternatives, evaluate alternatives, and making the decision. Pitfalls
that may occur in each stage may be not properly recognising and and identifying the
problem and able to identify alternatives may lead to making a wrong decision.

1-30
What financial statement would the loan officer want to look to begin to
understand the business cash recipe and payments?
Financial statements that a loan officer would want to look at to understand the business
cash recipe and payments may be the summary .. yearly, monthly salary, profits, loss
etc.

1-31
What factors would you consider in deciding whether to operate your business as
a sole proprietorship, a partnership or a company?
Factors that I would consider in deciding what type of business to operate will depend on
an individuals skills. If an individual has experience with a trade a sole proprietorship is
recommended however if an individual is innovative and has ideas which has business
potential and marketing growth, establishing either a partnership or company would be
recommended.

Jamal Ali