Chapter 1, End of Chapter, Questions, Exercise 1

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Explanation

Accounting is the method of keeping track of a company's financial transactions. Financial activities or transactions are recorded, summarizing those events and transactions, then analyzing and reporting them into the respective accounts that provides insights about the company's performance to the insider and outsider parties, such as managers, employees, regulators, tax authorities, banks, shareholders, and so on.

Verified Answer

Accounting is the process in which the financial data of an organization is collected, recorded, processed, analyzed, and interpreted to help the management and external users for efficient decision-making.

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