Commerce Exam  >  Commerce Questions  >  How are financial statements beneficial to ow... Start Learning for Free
How are financial statements beneficial to owners of a company?
(i) Financial statements report the performance of the management to the shareholders.
(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.
  • a)
    Only(i)
  • b)
    Only(ii)
  • c)
    Both (i) and (ii)
  • d)
    Neither(i) nor (ii)
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
How are financial statements beneficial to owners of a company?(i) Fin...
Financial statements are crucial documents that provide a snapshot of a company's financial health and performance. They are beneficial to owners of a company in several ways:
- Reporting management performance: Financial statements report the performance of the management to the shareholders. By analyzing these statements, owners can gauge how well the management is utilizing company resources, making strategic decisions, and meeting financial goals. This helps owners assess the effectiveness of the management team and hold them accountable for their performance.
- Understanding ownership expectations: Financial statements help owners understand the gaps between the management's performance and ownership expectations. By comparing actual financial results with projected or expected outcomes, owners can identify areas of improvement, set realistic goals, and make informed decisions about the future direction of the company. This insight allows owners to align management actions with their vision for the business and ensure that it remains on track for success.
In conclusion, financial statements play a vital role in keeping owners informed about the financial performance of their company, evaluating management effectiveness, and making strategic decisions. By leveraging the information provided in these statements, owners can better understand the company's financial position, identify areas for improvement, and take proactive steps to drive growth and profitability.
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
Explore Courses for Commerce exam

Top Courses for Commerce

How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer?
Question Description
How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer?.
Solutions for How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce. Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer?, a detailed solution for How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer? has been provided alongside types of How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice How are financial statements beneficial to owners of a company?(i) Financial statements report the performance of the management to the shareholders.(ii) The gaps between the management performance and ownership expectations can be understood with the help of financial statements.a)Only(i)b)Only(ii)c)Both (i) and (ii)d)Neither(i) nor (ii)Correct answer is option 'C'. Can you explain this answer? tests, examples and also practice Commerce tests.
Explore Courses for Commerce exam

Top Courses for Commerce

Explore Courses
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev