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¶ … Costing
Financial Accounting-Variable Costing
How is managerial accounting different from financial accounting?
Managerial Accounting refers to the processes in application by the company or business organization to identify, measure, analyze, interpret, and communicate vital information in relation to pursuing the mission, objectives, goals, and vision of the entity. Managerial Accounting is also the cost accounting. Financial Accounting is the act of providing relevant information on the financial position and performance of the company using financial statements to the external users or investors on a cyclic basis. Financial Accounting and Managerial Accounting differs in relation to their applications. They also differ in the context of the interests they serve while enabling the company to meet its needs. Managerial Accounting enables the company to obtain vital information to help managers within the company to make crucial decisions about the firm. This indicates that managerial accounting is critical for internal purposes. Financial Accounting offers significant information to investors or parties outside the firm. This illustrates that financial accounting is vital to external users in evaluating the performance of the company.
Comment on the different needs and use of financial information for internal purposes.
Financial information serves different needs within the context of the company. The first need for the financial information is to enable the organization to evaluate its performance for certain duration in the market or industry of operation. The company needs to evaluate its performance in order to make decisions on whether or not to continue with the strategies of pursuing the mission and vision....
This is an indication that financial information enables managers to make crucial information on how to conduct business in the market and relevant industry. Financial information also enables the company to compare performances of different departments within the organization. Financial information would allow the company to set goals and priorities for the incoming period of transactions.
The managerial accounting profession and its role in today's business environment. How has it changed over time?
Managerial Accounting Profession is crucial to the development of the business environment in the contemporary world. This is because managerial accounting profession enables the business entities to make vital decisions on the strategies of the organization. Managerial accountants formulate financial information that is relevant to the internal purposes. The financial information only applies to the company hence allows the business entity to evaluate the progress and make critical decisions. There are developments in the profession of managerial accounting in order to address changes in corporate reporting and the emergence of advisory services. There is also the adoption of Certified Management Accountant (CMA) designation to enhance the provision of quality services within the profession. This allows managerial accountant to conform to the standards of the profession.
Comment on the Certified Management Accountant (CMA) designation. How is it different from the CPA certification?
Certified Management Accountant represents an accounting designation…
Managerial and Financial Accounting Case Managerial Accounting - Variable Costing Managerial accounting emphasizes short-term profit analysis, income statement important. Consequently, 'll examine discuss income statements case. Managerial and Financial Accounting Financial and managerial accounting basic difference comes on the uses. While, financial accounts are prepared for use by external parties, managerial accounts are prepared for use internally. The process of preparing the accounts in both financial and managerial accounting use similar source for
Financial Accounting Accounting Concepts Financial Statements (Regulatory oversight) The rapid failure and bankruptcy of Enron has prompted severe criticism of the nation's financial reporting and auditing systems, which are fundamental to maintaining investor confidence in U.S. capital markets; there are four areas in which the Enron failure revealed serious problems: corporate governance, the independent audit of financial statements, oversight of the accounting profession, and accounting and financial reporting issues (GAO, 2002). The financial
4)1. The NPV of the project is $36,438,244 and the IRR is 312%. Depreciation is not included in the calculation because it is not a cash flow. It impacts flows at the tax level, but the tax rate is not known so this impact could not be calculated. 2. During the sensitivity analysis, the discount rate proves to be irrelevant. Dramatic changes in the hurdle rate are barely reflected in the
Profit analysis is a financial accounting methodology that has myriad uses in the manufacturing industry and other sectors like the restaurant, energy, and banking industry (Brugger, 2013). It helps in business management. Some of the specific uses of cost volume profit analysis include goal setting, pricing strategy, operational efficiency, and marketing strategies (Brugger, 2013). Cost profit volume (CVP) analysis is principally used to position management to se more informed, data
Managerial Accounting Accounting Managerial accounting is different from financial accounting because it is used primarily by companies and organization to generate weekly, daily and monthly reports to help them forecast future financial events (Birnberg, 1992). The profession of managerial accounting looks at the many ways managers can help facilitate increased revenues over defined times, and the future in general. It is not concerned with investments as much as it is concerned with
Yet, financial statements and managerial accounting reports can be highly effective nonetheless. Sometimes they will merely confirm what the proprietor already knows, but there are inevitably going to be times when they will reveal that the proprietor's assumptions about the nature of the business are false. Moreover, accounting can act as essentially a second opinion. The proprietor may feel one thing is true, but the numbers can reveal something