Question

Which is the last step of accounting as a process of information ?

• A. Recording of data in the books of accounts.
• B. Preparation of summaries in the form of financial statements.
• C. Communication of information.
• D. Analysis and interpretation of information.

Answer 1

Answer: (C)

Communication of information.

Accounting starts with

-identifying a transaction

-then recording in Journal

-then classifying in the ledger

-then summarising in final accounts

-then interpretation through Ratio analysis

-then finally communicating the information to the users of the financial statement.

So, the first step is identifying and the last step is communicating the information.