Accounting Information Systems - Contemporary View Integration of Quantitative and Qualitative Data
Accounting Information Systems - Contemporary View Integration of Quantitative and Qualitative Data
Accounting Information Systems - Contemporary View Integration of Quantitative and Qualitative Data
Introduction
3. Recognize the role of relevant factors Accounting Information is used by
in decision making; and internal managers in their day-to-
4. Understand source of ethical issues in day decision making and also by
business and the importance of external users, such as investors,
maintaining an ethical business creditors, donors, and even the
environment. Internal Revenue Service.
1
Users of Financial Types of Information Needed By
Information External Users
Information about current
and future profitability of a
Stockholders company
& Investors Examples: annual reports,
registration statements,
prospectuses
Planning
Detailed information thats
more flexible than financial
Suppliers
Operating
information and similar to and
internal user needs. Customers Controlling
Examples: bank balances and
inventory levels
2
Short Term Planning Activities LongTerm Planning Activities
Known as Known as
Operational Strategic
Planning Planning
includes: includes:
Time Plant
Sales budgets Sales Locations
quotas Growth
Customer New
Service Equipment
Needs Investment
Current Market
Cash Share
Needs
J
Should Price
We Should Performance
Be
Advertise?
Charged? Measures
Product Quality
3
Different Informational Needs The Information Needs of
of Users External Users
Limited-access databases
SOURCE: Tax returns and other SOURCE: available to specific
reports.
customers and suppliers.
4
Relevant Costs Sunk Costs
These are costs that have already
These are avoidable or can be been incurred. They cannot be
eliminated by choosing one avoided and are irrelevant.
alternative over another.
For Example: Watching a horrible
rental movie that is unbearable during
For Example: Buying a car with a CD its first 20 minutes. The rental fee is a
changer versus buying sunk cost. You can either decide to
a car without one. stick it out or use the time to do
something more fun.
Ethics and
Opportunity Costs
Decision Making
These are benefits forgone by In todays business environment, companies have to be
aware not only of the economic impact of their decisions,
choosing one alternative over but also of their ethical impact.
another. They are relevant.
Information
Good Ends?
For Example: Choosing to go to college being used Bad Ends?
for?
or work full-time. The opportunity cost
is the higher salary you will receive as a
college graduate. (In general, these
costs are hard to quantify.)
End of Chapter 1