As key users of accounting information, employees typically evaluate their company's financial statements to:
A) provide financial information to federal agencies.
B) find if the company can pay for the products that it orders.
C) identify possible layoffs, shutdowns, or pay raises.
D) receive uptodate information about inventory and capital.

Question

As key users of accounting information, employees typically evaluate their company's financial statements to:
A) provide financial information to federal agencies.
B) find if the company can pay for the products that it orders.
C) identify possible layoffs, shutdowns, or pay raises.
D) receive up­to­date information about inventory and capital.

Quizplus · Accepted Answer

Employees typically evaluate their company's financial statements to identify possible layoffs, shutdowns, or pay raises. This is because financial statements provide information about the company's financial health and potential for growth, which in turn can impact the employees' job security and compensation. While financial statements may provide information about inventory and capital, this is typically more relevant to senior management and investors rather than individual employees. And while financial statements may be used to provide financial information to federal agencies, this is not typically a primary concern for individual employees. Finally, employees may be interested in whether the company can pay for the products it orders, but this is typically not their primary concern when evaluating financial statements.

As Key Users of Accounting Information, Employees Typically Evaluate Their