Part 1
A major aim of financial information is to provide inputs for decision”making.”¯Accounting”¯can be described as the information system which identifies, records, and communicates the financial activity of an entity to others.”¯The users”¯of accounting information are easily separated into two groups: internal users and external users.
Respond to the following in a minimum of 175 words: (2 post @ 175 words each)
Discuss who are the internal users and external users of accounting information.
Discuss what the primary concerns are to both groups.
Part 2
Purpose of Assignment
This activity helps students recognize the significant role accounting plays in providing financial information to management for decision making through the evaluation of financial statements. This experiential assignment requires students to use ratios to evaluate and analyze a company’s liquidity, solvency, and profitability.
Two-Rivers Inc. (TRI) manufactures a variety of consumer products. The company’s founders have run the company for thirty years and are now interested in retiring. Consequently, they are seeking a purchaser, and a group of investors is looking into the acquisition of TRI. To evaluate its financial stability, TRI was requested to provide its latest financial statements and selected financial ratios. Summary information provided by TRI Document presented below.
TRI Documents
Required:
a. Calculate the select financial ratios for the fiscal year Year 2. (use MS word or excel but excel is more recommended)
b. Interpret what each of these financial ratios means in terms of TRI’s financial stability and operating efficiency.