WAEC Accounting 2014 Theory — Question 2

Model answer

(i) It serves as reference for future consultation. (ii) It helps in decision making. (iii) It provides a basis for comparison. (iv) It enables management to know the performing and non-performing areas of the business. (v) It facilitates the preparation of final accounts for businesses. (vi) It helps to determine the tax chargeable to a business. (vii) It also helps in knowing the profit and/or loss level of the business.