Explain what is meant by financial accounting and the primary users. Do you think it is...

Explain what is meant by financial accounting and the primary users. Do you think it is important to have rules for presentation of financial statements? Why or why not?

300 words

Expert Solution

Financial accounting is the process of recording, summarizing, reporting, and analyzing the financial track of a firm through financial statements issued to exterior customers over a period of time.

The Four Principle types of financial statements are

Balance Sheet
Income Statement
Statement of Retained Earnings
Cash Flow Statement

The primary users of financial accounting are the external users, shareholders, investors , creditors, lenders and government. Share holders are using financial information to know about their investment and where to invest.

Financial accounting helps a business owner Evaluate the financial performance of his business , and also how money in the business is used. Financial accounting guide the investor and shows the information of the the company about their economic position. Every company by following same financial accounting process would be helpful to the investor what is the actual position of the company in the market

ekkarill92 answered 2 years ago

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