ZuoTi.Pro
Question

Which of the following characteristics does NOT apply to Financial Accounting? Used by investors when making stock purchase d
business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Financial Accounting provides statements which shows the transactions, events and financial position of an enterprise in the form of Balance sheet, Profit and loss account as well as cash flow statement. This is used by various personnel or stakeholders for taking important business decisions.
a- Used by investors when making stock purchase decisions- Investors examine the financial accounting reports of entity to know whether business is successful as well as profitable or not. Based on that they make important decisions of whether to invest in business or not by making it's stock purchase
b- Information reviewed by external auditors- External auditors conduct audit of an entity to determine whether business is conducted lawfully or not as well as within the predetermined boundaries as per it's Memorandum and articles. Auditors rely on Financial Accounting of the entity concerned to perform their various audit procedures necessary for forming an opinion
d- Used by creditors when making Loan approval decisions- Creditors need to examine the Financial accounting of an entity to determine whether it has the ability to pay off any debts that can be extended to it as well as it's limitations. Financial accounting assists creditors in making decisions for approving loans to entity

From above it is clear that Financial accounting if used for all 3 purpose but Financial accounting used documentary evidence such as vouchers and invoices to prepare it's reports. Financial accounting is based on facts and it does not uses predictions regularly. However there are certain instances when making predictions becomes necessary but only to a limited extent and also after there is high level of certainity. Hence Financial accounting does not REGULARLY USES PREDICTIONS (Option c)

0 0
Add a comment
Know the answer?
Add Answer to:
Which of the following characteristics does NOT apply to Financial Accounting? Used by investors when making...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • QUESTION 17 Financial accounting does not deal with which of the following? Measuring a company's economic...

    QUESTION 17 Financial accounting does not deal with which of the following? Measuring a company's economic activity. Providing information to internal users. Preparing financial reports. Communicating financial results to investors. QUESTION 18 Financial accounting objectives do not include providing information: O Useful to investors and creditors in making decisions. To determine market values, assess profit potential, and evaluate management. Helpful to investors in predicting cash flows That tells about a company's economic resources and claims to those resources. QUESTION 19...

  • It is the responsibility of management to apply accounting standards when communicating with investors and creditors...

    It is the responsibility of management to apply accounting standards when communicating with investors and creditors through financial statements. Another group, auditors, serves as an independent intermediary to help ensure that management has in fact appropriately applied GAAP in preparing the company's financial statements. Auditors examine (audit) financial statements to express a professional, independent opinion. The opinion reflects the auditors' assessment of the statements' fairness, which is determined by the extent to which they are prepared in compliance with GAAP....

  • Which of the following is the primary focus of financial accounting?

    Which of the following is the primary focus of financial accounting?A) providing summarized information on operational results to investors and creditorsB) providing highly detailed information on product lines, regions, and divisionsC) providing information to managers to assist in planning, directing and controlling operationsD) providing information that managers need to make operational decisionsWhich of the following statements is true of managerial accounting?A) Managerial accounting information must comply with Generally Accepted Accounting Principles.B) The external stakeholders of a company are the primary...

  • When comparing financial and managerial accounting, which of the following apply to managerial accounting? Check all...

    When comparing financial and managerial accounting, which of the following apply to managerial accounting? Check all that apply. 0 Information reported for whole company 0 Emphasizes the future Objective and reliable O Reports at the decision making level Mandatory for external reports 0 Reports are prepared as needed Do you know the answer? Read about this I know it Think so Unsure Unsure No idea

  • Financial accounting provides information used primarily by creditors investors employees executives

    Financial accounting provides information used primarily by creditors investors employees executives

  • Financial accounting does NOT deal with which of the following? Financial accounting does NOT deal with which of the...

    Financial accounting does NOT deal with which of the following? Financial accounting does NOT deal with which of the following? Select one a Communicating financial results to investors b. Measuring a company's economic activity. c. Allocating cost to different products. O d. Preparing financial statement

  • Which of the following statements about managerial accounting is false? Financial accounting is based on reliable,...

    Which of the following statements about managerial accounting is false? Financial accounting is based on reliable, historical information, while managerial accounting is based on relevant, forward-looking information. The Chief Operating Officer is responsible for managing financial risk within an organization, and both the Treasurer and the Controller typically report up to the COO. Managerial accounting is focused on reporting the results of segments within a business, while financial reporting is focused on reporting the results of the consolidated company as...

  • Which of the following is not an external user of a business's financial information? O A....

    Which of the following is not an external user of a business's financial information? O A. Investors OB. Customers O c. Employee OD. Taxing authorities

  • Which of the following statements about managerial accounting is false? Financial accounting is based on reliable,...

    Which of the following statements about managerial accounting is false? Financial accounting is based on reliable, historical information, while managerial accounting is based on relevant, forward-looking information O External auditors are used to verify the reliability of financial information to the investing public Managerial accounting is focused on reporting the results of segments within a business, while financial reporting is focused on reporting the results of the O consolidated company as a whole. The Chief Operating Officer is responsible for...

  • Indicate whether the following statements describe financial accounting or managerial accounting.

    Take me to the textIndicate whether the following statements describe financial accounting or managerial accounting.Largely based on forecasting future sales and cash flows, calculating costs and preparing budgets.is concerned with collecting data of historical nature.Reports are very detailed and provide a wealth of information.Must follow Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS) set by professional bodies.Primarily prepared for external users such as creditors and stockholders so that they can make sound financial or investment decisions.Does not...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT