Accounting Information and Decision Making Term Paper

Accounting Information and Decision Making - Term Paper Example This is normally achievable through the comparison of the organization with rival firms in the same sector or market. Accounting information facilitates this comparison. The following paper is a collection of theoretical knowledge on accounting information and decision-making for the reader’s basic insight, its definition, and history. The paper will further discuss and analyze the gathered literature in detail and develop a personal conclusion on the relationship between accounting information and decision-making. The earliest possible application of organized recordkeeping in human history goes back thousands of years to early Mesopotamia, which is Iraq today. Archeologists and historians found shelved records of supplied farm produce. Using accounting to keep a record of many dealings enabled improved trade amongst persons and assisted the advancement of more complicated communities. After Mesopotamia, Luca Pacioli possibly pioneered the earliest official literary work of accounting with arithmetic concepts in 1494. Pacioli, a monk and mathematician from Italy defined the double entry system by shedding light on the logic of bookkeeping. Pacioli theorized that one has to record all items twice but variedly, i.e. double entry. Double entry means that when one credits one item, he or she debits the corresponding one, or debits the recipient and credits the giver. During Pacioli’s era, record-keepers made entries to show statements for the enterprise instead of the owner, making annual preparation wanting. After Pacioli, a Dutchman supported the profit and loss books at annual breaks. The degree of societal and technological progress assisted the advancement of contemporary techniques of accounting. The Industrial Revolution brought about the need for sophisticated accounting techniques. The advancement of new techniques saw the separation of ownership from