ACCA BT · Chapter 5 · Question 9 of 10
Which of the following users of financial statements is most interested in assessing whether a company can repay loans when they fall due?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Lenders
Explanation
Lenders, such as banks and bondholders, use financial statements primarily to assess the entity's liquidity and ability to meet interest and capital repayments. Employees focus on job security and pay, the public on wider impact, and competitors on comparative performance.
More The role of accounting and the finance function MCQs
- Q1Which of the following is the main purpose of financial accounting?
- Q2Which of the following is a typical feature of management accounting information?
- Q3Which of the following activities is most likely to be carried out by an organisation's treasury function?
- Q4Which of the following best describes the role of the management accountant in the 'control' stage of the management process?
- Q5Which of the following systems is used to record routine, day-to-day business transactions such as sales and purchases?