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    Question

    The primary objective of financial accounting is

    to:
    A Assist the management in planning and control. Correct Answer Incorrect Answer
    B Provide information to external users for decision-making. Correct Answer Incorrect Answer
    C Calculate the amount of tax liability. Correct Answer Incorrect Answer
    D Record day-to-day business transactions. Correct Answer Incorrect Answer
    E Determine the market value of the business. Correct Answer Incorrect Answer

    Solution

    While management uses accounting data, the primary purpose of financial accounting is to communicate the financial position and performance to external stakeholders like investors, creditors, and regulators.

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