Answer to Question #95626 in Accounting for Vitus

Question

Different user group are interested in an entit's financial statement for different reasons.identify any four potential user group and briefly describe the information which they May be interested in

Answer 1

Lenders require the liquidity ratios to establish whether the company can generate enough money to settle loans and interests.

Rating agencies need the statement of equity to rate the company's marketable securities.

Suppliers utilize the the information about outstanding debts and liquid assets to decide whether to deliver goods on credit basis.

Unions use the profit and loss account to signal members of the inability of the business to pay their members salaries and other non-cash benefits.