How can accurate reporting of income improve business decision making?

Question

I would like you to give me some ideas of how accurate reporting of income improves a business's decision making. Also I would like you to tell me some disadvantages of not accurately reporting income, and how that will affect the business's decision making?

Answer 1

Lots of ways.....if you have accurate reports of income you can judge what to put your resources into, like Product A vs. Product B. If you don't know how much is selling of what, you don't know which products to develop more of.

Also, if you are running low on cash and your income figures aren't accurate, you may find yourself running out of cash to pay your bills.