Question

The Accounting Cycle Accounting is the recording, classifying, summarizing, and interpreting of financial events and transactions to provide management and other interested parties the information they need to make good decisions. Most businesses use a formal accounting cycle to prepare and analyze the major financial statements (balance sheet, income statement, and statement of cash flows). This short video describes how a small business prepares the information used in the accounting cycle. 1). Source documents would include items such as receipts, travel records, etc. financial statements. trial balances. journal entries. stock options. 2). The balance sheet, income statement, and statement of cash flow are the financial statements. statements of equity. journal entries. ledger entries. balance of trade. 3). At the conclusion of the Accounting Cycle are a series of financial statements. Who is the audience to view these documents? leaders of the company stockholders investors Internal Revenue Service All of the choices are correct. Please answer all of these, thank you!

Answer 1

There main users of the financial statements are,

• Company management. The management team needs to understand the position of the organization to make decisions

• Competitors. Competitors will want to know the position of their rival's business.

• Customers. Customers will need to judge the organization in order to do business with them.

• Employees. Employees understanding the organization through its financial statement will help them to work efficiently and help them understand the business.

• Governments. Governments usually require financial statement to check the amount of taxes paid is appropriate.

• Investors. Investors need to check the business's progress as they are putting their funds in it.

• Lenders. Lenders will need to know the business position in order to ensure whether the organization will be able to payback in the future..