Question

The type or branch of accounting that generates reports for the use of external parties such as creditors, investors, and government agencies is known as:

a. Managerial accounting
b. Cost accounting
c. Financial accounting
d. Tax accounting

Answer 1

Financial accounting is the branch of accounting that generates reports for external parties such as creditors, investors, and government agencies.

Step-by-step explanation:

The type or branch of accounting that generates reports for external parties such as creditors, investors, and government agencies is known as financial accounting. Financial accounting focuses on providing accurate and reliable financial information to users outside of the organization to help them make informed decisions.

Financial accounting involves the preparation, analysis, and communication of financial statements, which include the income statement, balance sheet, and cash flow statement. These statements provide information about the organization's financial performance, position, and cash flows.

Financial accounting follows generally accepted accounting principles (GAAP) and is governed by various regulations and standards, such as the International Financial Reporting Standards (IFRS) and the Generally Accepted Accounting Principles (GAAP) in the United States.