Why is proper classification of data necessary in a growing business using a Computerised Accounting System?

To manage an increasing volume of transactions systematically

The correct answer is option 3- To manage an increasing volume of transactions systematically.

The proper classification of data is necessary in a growing business using a Computerised Accounting System to manage an increasing volume of transactions systematically.

The grouping of accounts typically refers to the classification of data from Assets, Capital, Liabilities, Revenue, and Expenses. This broader classification includes all major categories used in financial accounting.
Assets = Liabilities + Capital + (Revenues – Expenses).

The increase in the number of transaction changes the volume and size of the business. Therefore it becomes necessary to have proper classification of data. The basic classifications of different accounts embodied in a transaction are resorted through accounting equation.