Interactive question 2: Value of reputation

May 19th, 2015
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The firm may have relatively little in the form of things you can touch, perhaps a building, desks and chairs. If you simply drew up a balance sheet showing the cost of the things owned, then the business would not seem to be worth much, yet its income earning potential might be high.

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Chapter -01:Introduction to AccountingInteractive question 1: Accounting information [Difficulty level: Intermediate]It is easy to see how 'internal' people get hold of accounting information. A manager, for example, can just go along to the accounts department and ask the staff there to prepare whatever accounting statements she needs. But external users of accounts cannot do this. How, in practice, can a business contact or a financial analyst access accounting information about a company?Answer:Limited liability companies (though not other forms of business such as general partnerships) are required to make certain accounting information public. This is done by filing information centrally, as a government requirement.Interactive question 2: Value of reputation [Difficulty level: Intermediate]An accountancy training firm has an excellent reputation amongst students and emplo

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