When two teams pair up for a game of football,
there is often a lot of noise. The band plays, the
fans cheer, and fireworks light up the score-
board. Obviously, the fans are committed and
care about the outcome of the game. Just like
fans at a football game, the owners of a busi-
ness want their business to “win” against their
competitors in the marketplace. While having
our football team win can be a source of pride,
winning in the marketplace goes beyond pride
and has many tangible benefits. Companies that
are winners are better able to serve customers,
provide good jobs for employees, and make
more money for the owners.
An example of such a successful company
is the Hershey Foods Corporation, founded by
Milton Hershey in the early 1900s. Hershey
Foods Corporation is America’s leading choco-
late manufacturer, producing more than a
billion pounds of chocolate products each year.
In addition to Hershey chocolate bars, the
company sells candy under such brands as
Reese’s, Twizzlers®, York®, Almond Joy®, and
Kit Kat®.
The success of Hershey Foods brought
wealth to the Hershey family. So what did
Milton and his wife do with their wealth? First,
they built a model town that included com-
fortable homes and an inexpensive public
transportation system for their employees.
Although Milton and his wife, Catherine, had
no children of their own, they established a
school for orphan boys. Following Catherine’s
premature death in 1918, Milton endowed the
school with his stock in the Hershey Chocolate
Company. Today, the 10,000-acre school nur-
turesover 1,300 financially needy boys and girls
in gradesK-12. Through the Hershey Trust
Company, the school controls 78% of the vot-
ing shares of Hershey Foods Corporation. Thus,
when Hershey Foods wins, so does the Hershey
School.
As we begin our study of accounting in this
chapter, we will first discuss the nature, types,
and activities of businesses, such as Hershey’s.
In doing so, we describe business stakeholders,
such as the owners, customers, and employees.
We conclude the chapter by discussing the role
of accounting in business, including financial
statements, basic accounting concepts, and how
to use financial statements to evaluate a busi-
ness’s performance.Hershey Foods Corporation
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