Question

What is the primary objective of financial accounting?

1) To provide information about the financial position, performance, and cash flows of an entity
2) To record and summarize financial transactions
3) To assist in decision-making and resource allocation
4) To ensure compliance with financial reporting standards

Answer 1

The primary objective of financial accounting is to provide information about the financial position, performance, and cash flows of an entity, helping in decision-making and resource allocation.

Step-by-step explanation:

The primary objective of financial accounting is to provide information about the financial position, performance, and cash flows of an entity. Financial accounting involves recording and summarizing financial transactions, which helps in assessing the financial health of a business. Additionally, financial accounting provides information that can assist in decision-making and resource allocation.