Asked by Emily Fritsch on Jun 07, 2024

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Which of the following is the best description of accounting's role in business?

A) Accounting provides stockholders with information regarding the market value of the company's stocks.
B) Accounting provides information to managers to operate the business and to other users to make decisions regarding the economic condition of the company.
C) Accounting helps in decreasing the credit risk of the company.
D) Accounting is not responsible for providing any form of information to users. That is the role of the Information Systems Department.

Accounting Role

The function or position that involves recording, summarizing, and reporting financial transactions to ensure accurate financial management and compliance with accounting standards.

Economic Condition

The state of a country or region's economy at a given time, including factors like growth rate, inflation, and unemployment.

  • Distinguish between the user groups of financial information and the intent behind assorted financial declarations.
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AY
Andrew YoungJun 10, 2024
Final Answer :
B
Explanation :
Accounting plays a crucial role in providing information to managers to run the business effectively and efficiently. It also provides information to other users such as investors, creditors, and government agencies to make important economic decisions regarding the company. Option A is incorrect as accounting provides information on the financial performance of the business, not the market value of stocks. Option C is also incorrect as accounting can assess the creditworthiness of a company, but it is not responsible for decreasing credit risk. Option D is incorrect as accounting plays a vital role in providing financial information to users.