ECONOMICS

Detailed explanation-1: -The area of accounting that focuses on the reporting of financial statements that provide useful accounting information to its external users like investors, suppliers, creditors, and the government is financial accounting.

Detailed explanation-2: -Financial accounting information is created for external users such as creditors and investors. This is prepared for external users to make important business decisions because they are not involved in the day-to-day operations of the company.

Detailed explanation-3: -External users are people outside the business entity (organization) who use accounting information. Examples of external users are suppliers, banks, customers, investors, potential investors, and tax authorities.

Detailed explanation-4: -While the focus of managerial accounting is internal, the focus of financial accounting is external, with a focus on creating accurate financial statements that can be shared outside the company.

Detailed explanation-5: -Managerial accounting is the area of accounting that serves the decision-making needs of internal users.