Chapter 1, Problem 1DQ

To determine

Name some users of accounting information.

Explanation of Solution

Users of accounting information: People who rely on accounting information to make best decisions or choices from the information are known as users of accounting information.

Users of accounting information are as classified as below:

• Internal users of accounting information: Internal users of accounting information depend on the information, to check to what extent the business has achieved its goals, any other measures to be taken to achieve the goals, and progress further. The internal users are company’s managers and employees. These are the users working for the company.
• External users of accounting information: External users of accounting information depend on the information to check the progress and profitability of the business, assess the ability of the company to repay the liabilities, measure income of the company, and evaluate the return of the company for the investment. The external users are customers, creditors, taxing authorities, and investors. These are the users who do not work for the company.

Conclusion

Hence, some of the users of accounting information are employees, managers, customers, investors, creditors, and government (tax authorities).