Multiple Choice
Which of the following is NOT one of the four general accounting principles?
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1. Introduction to Accounting
Types of Accounting
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Which of the following best describes how recordkeeping helps in accounting?
A
By ensuring that all business transactions are profitable
B
By providing organized and accurate financial information for decision-making
C
By eliminating the need for financial statements
D
By replacing the need for budgeting and forecasting
Verified step by step guidance1
Understand the concept of recordkeeping in accounting: Recordkeeping involves systematically documenting all financial transactions of a business to ensure accuracy and organization.
Recognize the purpose of recordkeeping: It provides a foundation for preparing financial statements, budgeting, forecasting, and making informed decisions based on accurate financial data.
Eliminate incorrect options: Recordkeeping does not ensure profitability of transactions, nor does it eliminate the need for financial statements, budgeting, or forecasting.
Focus on the correct option: Recordkeeping helps by providing organized and accurate financial information, which is essential for decision-making in accounting.
Conclude that the correct description of recordkeeping is its role in supporting decision-making through accurate and organized financial information.
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