Question

explain any two external use of accountanting information

Answer 1

With the use of accounting information firm can have it for many external uses.

1. They can be helpful in taking loans as banks can check the current liabilities and assets of the firm which will help them to check financial position of the firm.

2. They can be used by income tax department as reference and check if tax is paid on time and to avoid government interference.

Answer 2

Government : Government is one of the external user of accounting information .. government need info regarding statutory payment paid and payable to government ..


Investor : investor is the person who invested in the company .. investor need accounting information whether the company is financially strong and can pay the dues to investor without any bankrupt

Hope it's useful