Accounting helps in maintaining records of cash inflows and cash outflows of a business, capital used to purchase assets and maintain company’s operation like hiring employees, advertisements etc., and also helps in preparation of budgets.
3 main benefits of accounting:
1. Maintenance
Maintenance of business records and preparation of financial statements.
2. Valuation of business
Accounting helps in measuring the value of an entity in the case of sale of the entity.
3. Comparison of results
It facilitates the comparison of the financial results of one year with another year easily. This can help the investors to take informed decisions.