Managerial accounting differs from financial accounting in several areas. Specify whether each of the following characteristics

Question

3 years ago

14

Managerial accounting differs from financial accounting in several areas. Specify whether each of the following characteristics

relates to managerial accounting or financial accounting.
(a) Main characteristic of data is that it must be reliable and objectives
(b) Reports are prepared as needed
(c) Not governed by legal requirement
(d) Primary users are external(e) Focused on the future(f) Reporting is based mainly on the company as a whole(g) Reports are usually prepared quarterly or annually(h) Information is verified by external auditors

Business

1 answer:

Dennis_Churaev [7] · Answer 1 · 2022-05-28T20:10:05+03:00

Answer:

(a) Main characteristic of data is that it must be reliable and objectives - FA

(b) Reports are prepared as needed - MA

(c) Not governed by legal requirement - MA

(d) Primary users are external - FA

(e) Focused on the future- MA

(f) Reporting is based mainly on the company as a whole - FA

(g) Reports are usually prepared quarterly or annually - FA

(h) Information is verified by external auditors - FA

Explanation:

Managerial accounting is the process of classifying, measuring, analyzing, interpreting, and communicating information to managers for the pursuance of an organization's goals. The principal difference between managerial and financial accounting is managerial accounting information is aimed at helping managers within the organization make decisions, while financial accounting is aimed at providing information to parties outside the organization. While financial accounting creates reports for external investors, shareholders, and stakeholders, managerial accounting provides information to the company's internal managers and business owners so they can plan and control the business's activities.