Meeting Legal Requirements in Accounting & Financial Reporting
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Questions and Answers

What is one of the functions of accounting in relation to financial information?

  • Communicating the financial information to internal and external users (correct)
  • Scheduling meetings for management
  • Maintaining IT infrastructure for the company
  • Operating machinery within a business

Why is it important for management to have access to accurate financial information?

  • To provide entertainment for the employees
  • To help in decision-making and business planning (correct)
  • To organize team-building events
  • To facilitate voting on company decisions

Which aspect of accounting helps in determining the financial position of a business?

  • Recording profit earned or loss incurred
  • Organizing team-building events for employees
  • Maintaining systematic accounting records (correct)
  • Performing market research

How does accounting assist in determining whether a business made a profit or incurred a loss?

<p>By providing financial performance information at the end of the accounting period (D)</p> Signup and view all the answers

What is one of the primary functions of accounting according to the text?

<p>Maintaining systematic accounting records (C)</p> Signup and view all the answers

Which financial statements are included in the final accounts prepared at the end of the accounting period?

<p>Income Statement and Balance Sheet (B)</p> Signup and view all the answers

What is one of the objectives of accounting, as mentioned in the text?

<p>Facilitating management (B)</p> Signup and view all the answers

How does maintaining proper accounting records contribute to the reliability of financial statements?

<p>By determining profit or loss accurately (B)</p> Signup and view all the answers

How does systematic recording of transactions help in memory?

<p>It eliminates the need to remember transactions. (A)</p> Signup and view all the answers

What does a systematic record enable a businessman to do?

<p>Compare one year's results with other years and identify significant factors. (D)</p> Signup and view all the answers

In what way does accounting assist in the event of insolvency?

<p>It assists greatly by providing systematic records of transactions. (D)</p> Signup and view all the answers

Why is accounting information important in the sale of a business?

<p>To help determine the financial health and proper purchase price. (A)</p> Signup and view all the answers

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