Identify four user groups normally interested in financial information about a business.
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Identify four user groups normally interested in financial information about a business. |
Here is a tip:
The objective of accounting is to provide financial information to users for decision-making purposes.
Explanation
Interested parties seeking financial information about a company typically fall into the following categories: present and future owners of the company; managers interested in the company's operations; present and future creditors and government agencies.
The present and future owners of the company use the financial information to make decisions with their investments. They are interested in the potential returns and security of their investments.
Managers interested in the company's operations are the hired professionals to whom the owners of the business entrusted the company. They use the financial information to analyze the needs of the operations and to keep it running smoothly.
The present and future creditors are interested in the ability of the company to pay its currently maturing obligations as they fall due.
The government agencies are interested in the financial information for taxation and regulatory purposes.
Verified Answer
Present and future business owners and managers, as well as creditors and government agencies, comprise the four user groups interested in financial information about any given business.
Here is a tip:
The objective of accounting is to provide financial information to users for decision-making purposes.
Explanation
Interested parties seeking financial information about a company typically fall into the following categories: present and future owners of the company; managers interested in the company's operations; present and future creditors and government agencies.
The present and future owners of the company use the financial information to make decisions with their investments. They are interested in the potential returns and security of their investments.
Managers interested in the company's operations are the hired professionals to whom the owners of the business entrusted the company. They use the financial information to analyze the needs of the operations and to keep it running smoothly.
The present and future creditors are interested in the ability of the company to pay its currently maturing obligations as they fall due.
The government agencies are interested in the financial information for taxation and regulatory purposes.
Verified Answer
Present and future business owners and managers, as well as creditors and government agencies, comprise the four user groups interested in financial information about any given business.
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