BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Information used to determine which products to produce
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Information about economic resources, claims to those resources and changes in both resources and claims
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Information that is important in assessing the amount, timing and uncertainty of future cash flows
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Information that is useful in making investment and credit decisions
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Detailed explanation-1: -The objective of financial reporting is to provide financial information about the reporting entity that is useful to existing and potential investors, lenders, and other creditors in making decisions about providing resources to the entity. Financial reporting requires policy choices and estimates.
Detailed explanation-2: -The most specific objective of external financial reporting is to provide information about the enterprise’s resources, claims to those resources, and how both the resources and claims to resources change over time.
Detailed explanation-3: -However, the overall objective of financial reporting is to provide information about the finances of a company while complying with regulations. Financial reporting is vital for private and public companies because it reveals an organization’s strengths to business owners and investors.