Creditors use financial information to

assess if the business is creditworthy

Financial data is important to:

External users + Internal users

Users of accounting information are:

External users and Internal users

Employees use accounting information to

determine a company's profitability and profit sharing

decide which products to buy from which companies

Which of the following statements is not true about external users?

They are people within the company directly involved in business operations.

External uses are people outside the company

External users are only interested in the information generated by financial records.

These people utilize their own money and resources to invest into a company.

What is the purpose of the financial reports to the creditors (trade payables) of a company?

enable them to determine whether the company's loans and their interest attaching to them will paid when due

to evaluate what income they can reasonably expect from their investment.

to determine ho much business earns in order to assess its tax liabilities

to check the development and changes in services and products

Why do government and tax authorities need accounting information?

determine how much business earns in order to assess its tax liabilities

to determine if its financial statement are in accordance with the rules and regulations

to have a strong economic structure and keeping abreast of global economic

Why do competitors need the accounting information ?

Check the development and changes in services and products

to provides the money/ capital that the business needs to begin operations

to set goals for the organization, to evaluate the progress

to know this information to assess whether the employment conditions of the business are beneficial for them or not

Which of the following is not a reason why employees and trade unions need to know the accounting information of their company?

To plan for possible expansion or branching out to widen market.

The employees that made up the workforce of the company will be interested in information about the stability and profitability of the company.

To assess whether they are receiving the right compensation .

They need to know this information to assess whether the employment conditions of the business are beneficial for them or not

What is the purpose of Financial Information? Tick all that apply.

Evaluate the performance of the company

Assess the liquidity of the company

Make comparisons with other companies

Check compliance with taxation regulations

Users of Financial Information

Authored by Sharon Stewart

Business

10th Grade

Used 23+ times

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MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Internal user

External user

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Government

Internal users

External users

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Financial Institution

Internal Users

External Users

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Internal users

External users

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Internal users

External users

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Customers

Internal User

External User

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Inland Revenue

Internal User

External User

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