FNCE 3P93 Chapter Notes - Chapter 1: Management Accounting, Financial Accounting, Accounting
22 Jun 2014
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Document Summary
Managerial accounting is the provision of accounting information for a company"s internal users. It is the firm"s internal accounting system and is designed to support the information needs of managers. Unlike financial accounting, managerial accounting i not bound by any formal criteria such as generally accepted accounting principles or. Managerial accounting has three broad objectives: to provide information for planning the organization"s actions, to provide information for controlling the organization"s actions, to provide information for making effective decisions. It requires setting objective and identifying methods to achieve those objectives. For example, a firm may set the objective of increasing short-term and long-term profitability by improving the overall quality of its products. (2) controlling control is usually achieved by comparing actual performance with expected performance. This information can be used to evaluate or to correct the steps being taken to implement a plan. (3) decision making the process of choosing among competing alternatives.
