True or False Quiz on Accounting

Only internal users are allowed to access the financial statements of a business.

• True

• False

Employees are considered external users of accounting information because they do not manage the business.

• True

• False

Financial institutions like banks use accounting information to determine a business's creditworthiness.

• True

• False

The Bureau of Internal Revenue (BIR) is an internal user because it handles tax collection within the country.

• True

• False

Management reports such as budgets and forecasts are often more useful to external users than to internal users.

• True

• False

Potential investors rely on a company's financial performance to decide whether to invest.

• True

• False

Suppliers may refuse to extend credit to a company if its financial statements show low liquidity.

• True

• False

Customers use accounting information to determine whether the business will continue operating long-term.

• True

• False

Internal users are primarily concerned with how the business affects the economy and public welfare.

• True

• False

Stockholders are considered both internal and external users depending on their role in the business.

• True

• False