ECONOMICS

Detailed explanation-1: -The purpose of financial accounting is to provide information for assessing the profitability and financial position of the firm. The general purpose of the financial statements is to provide information about the results of operations, financial position, and cash flows of an organization.

Detailed explanation-2: -The purpose of financial accounting is to prepare a company’s financial statements to reflect a specific period of time. The three most common varieties of financial statements are the balance sheet, income statement, and statement of cash flow.

Detailed explanation-3: -Correct! The purpose of financial accounting is to provide useful information for outside investors, creditors, and others.

Detailed explanation-4: -The objective of financial statements is to provide information about the financial position, performance and cash flows of an enterprise that is useful to a wide range of users in making economic decisions. 13. Financial statements prepared for this purpose meet the common needs of most users.

Detailed explanation-5: -Statement #1: The income statement Profitability is measured by revenues (what a company is paid for the goods or services it provides) minus expenses (all the costs incurred to run the company) and taxes paid.