Question

• A student planning a career in business management wondered why it was important to learn cost and management accounting. How would you respond? Give some examples to support your point of view.

Answer 1

Explanation:

Let us understand what a cost accounting and management accounting deals with and how both are related to business management.

Cost accounting:

• It deals with expenses and cost assessment in terms for producing or buying products.
• Gives an idea of how to measure profit.
• To determine the selling price and this would be challenging and profitable to the business and to the market.

Management accounting:

This helps the business people to make decisions, assess performance, and it is one step ahead of cost accounting.

Any business management people has to deal with money, take decision, assess the market, measure profit. So it is important to get a knowledge on Cost and management accounting.