Question

give five points in support of the need accounting​

Answer 1

$\mathfrak{\huge\underline{Answer:}}$

•As the size of the business grows, it becomes necessary to maintain accounting records for the purpose of control, especially when outsiders are employed.

•In case of a partnership firm, all the partners may or may not be actively participating in the day-to-day management of the business. It is, therefore, necessary to record all the transactions in order to satisfy all the partners.

•The management needs a lot of information (for their internal use) for planning, controlling and evaluating the operations of the business. Hence, the need for accounting.

•Information is also needed by some outsiders, banks, creditors, etc. For example, it is required for filing sales tax, income tax, and other tax returns with appropriate tax authorities.

•When a firm approaches the bank for loan or the creditors for supply of goods on credit, the bank or creditors like to know the firm's financial position (whether it is financially sound or not) and its profit earning capacity.

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