Question

Most of the financial information about an organization is based on information generated from accounting records. The reports and financial statements prepared by accountants

A. can be helpful for the managers of publicly-held companies but are less helpful for small businesses and not-for-profit organizations.

B. seldom depict the accurate situation of the organization and therefore, should be viewed with skepticism.

C. are useful for employees and managers of the company but not for those outside of the organization.

D. provide information that can be used by decision-makers both inside and outside the organization.

Answer 1

Answer: (D)

Explanation: Reports and financial statements prepared by accountants are useful tools to evaluate an organisation's liquidity,solvency and stability. It helps the general public and other stakeholders to get the required data and information needed for decision making.

The inflationary trends shows the relationship between demand and supply in an economy which will help management to implement the necessary steps that will enhance it's operations.

The balance of trade between 2 countries provides necessary details for decision makers on when and how to improve or manage exports and imports.