BUSINESS ADMINISTRATION
RESEARCH METHODOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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are not considered a useful source of data.
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are an important source of external secondary data
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can be easily compared to those of foreign companies, since accounting procedures worldwide are similar
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are considered internal and proprietary data.
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Detailed explanation-1: -Internal financial reporting involves compiling and analyzing financial information for use by management in decision-making. External financial reporting involves compiling and reporting financial information for distribution among shareholders and potential investors.
Detailed explanation-2: -Accountants record both internal and external transactions. Internal transactions do not affect the basic accounting equation because they are economic events that occur entirely within one company. The purchase of store equipment for cash reduces stockholders’ equity by an equal amount.
Detailed explanation-3: -Managerial accounting differs from financial accounting because the intended purpose of managerial accounting is to assist users internal to the company in making well-informed business decisions.
Detailed explanation-4: -Creditors are the outsiders that lend money to the company. Therefore, creditors would not be considered internal users of accounting data for a company.