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Every profit or nonprofits business entity requires a reliable internal system of accountability. A business accounting system provides this accountability by recording all activities regarding the creation of monetary inflows of sales revenue and monetary outflows of expenses resulting from operating activities.The accounting system provides the financial information needed to evaluate the effectiveness of current and past operations. Besides, the accounting system maintains data required to present reports showing the status of asset resources, creditor liabilities, and ownership equities of the business entity.Financial accounting is concerned with the recording of financial transactions and analyzing the effect of such transactions to assist in the development of business decisions.
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