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Why is keeping proper accounts important in a business?

Answer and explanation

Correct answer: To understand income, expenses, and profit or loss

Proper accounts provide a systematic record of sales, income, expenses, assets, liabilities, and resulting profit or loss. This information helps the owner control costs, prepare budgets, plan cash needs, meet reporting responsibilities, and make informed business decisions. Destroying receipts, hiding profit, or deciding without information defeats the purpose of accounting.

Related tags

AccountingBusiness FinanceAccounting InformationIntroduction To AccountingAccountancyClass 11 Mcq

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