Bookkeeping: Bookkeeping is the process of recording financial transactions and other information related to a business on a daily basis. The primary characteristic of bookkeeping is to maintain accurate and updated accounts for each and every transaction that occur in a business. Accuracy is hence, the most important aspect of the bookkeeping process. Bookkeeping is primarily done to provide information during the preparation of financial statements. Accounting: Accounting is the systematic process of identifying, recording, and communicating financial information. Accounting is useful in obtaining important information about a business, such as profit or loss of a business during a particular period, and the financial worth of its assets, liabilities, and owners’ equity. Accounting provides information related to the resources of a firm, the means used to finance the resources, and the outcomes of the use of the resources. Whether bookkeeping and accounting are the same.

Question

The primary objective of financial accounting is to:a) Provide management with detailed reports for decision-making.b) Help the company save taxes.c) Provide financial information to external users.d) Track inventory levels.

Answer 1

Question

Chapter 1, Problem 5Q

To determine

Bookkeeping:

Bookkeeping is the process of recording financial transactions and other information related to a business on a daily basis. The primary characteristic of bookkeeping is to maintain accurate and updated accounts for each and every transaction that occur in a business. Accuracy is hence, the most important aspect of the bookkeeping process.

Bookkeeping is primarily done to provide information during the preparation of financial statements.

Accounting:

Accounting is the systematic process of identifying, recording, and communicating financial information. Accounting is useful in obtaining important information about a business, such as profit or loss of a business during a particular period, and the financial worth of its assets, liabilities, and owners’ equity.

Accounting provides information related to the resources of a firm, the means used to finance the resources, and the outcomes of the use of the resources.

Whether bookkeeping and accounting are the same.

Expert Solution & Answer

Learn your wayIncludes step-by-step video

See solution

Check out sample textbook solution

01:26

Students have asked these similar questions

The primary objective of financial accounting is to:a) Provide management with detailed reports for decision-making.b) Help the company save taxes.c) Provide financial information to external users.d) Track inventory levels.

Need help! What is the formula for calculating the net present value (NPV) of an investment?A) Future Cash Flows × Discount RateB) Present Value of Cash Inflows - Initial InvestmentC) Internal Rate of Return - Discount RateD) Net Income / Initial Investment

Need help! In the context of accounting, "liquidity" refers to:a) The amount of cash a business hasb) The ability to pay short-term obligations as they come duec) The net income of a businessd) The profitability of a business