Asked by Kameron Teague on Apr 24, 2024
Verified
Which of the following best describes accounting?
A) records economic data but does not communicate the data to users according to any specific rules
B) is an information system that provides reports to users regarding economic activities and condition of a business
C) is of no use by individuals outside of the business
D) is used only for filling out tax returns and for financial statements for various type of governmental reporting requirements
Accounting Description
A detailed account or explanation of the nature, features, and implications of an accounting entry or policy.
Economic Activities
Actions that involve the production, distribution, and consumption of goods and services within an economy.
- Pinpoint the diverse types of financial information consumers and the function of multiple financial statements.
Verified Answer
MH
Michaela Hocknell4 days ago
Final Answer :
B
Explanation :
Accounting is an information system that involves recording, classifying, measuring, and communicating financial information to different users of financial information to help them make better-informed decisions. The system produces various financial reports such as the balance sheet, income statement, and cash flow statement, which are used by management, investors, creditors, and other stakeholders. Accounting is not just for taxes and financial statements for government reporting, but it plays a significant role in facilitating sound financial decisions within organizations.
Learning Objectives
- Pinpoint the diverse types of financial information consumers and the function of multiple financial statements.
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