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Chapter 1

COM 316 Chapter Notes - Chapter 1: Operational Excellence, Corporate Social Responsibility, Risk Management


Department
Commerce
Course Code
COM 316
Professor
Klatt Margaret
Chapter
1

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Sunday, January 3, 2016
COM 316! !
MANAGERIAL ACCOUNTING AND THE BUSINESS ENVIRONMENT
-Describe the functions performed by managers:
Planning: developing goals and specifying how to achieve them
Directing & motivating: mobilizing people to carry out plans and run routine
operations
Controlling: gathering feedback to ensure that the plan is being properly executed or
modified as necessary
Decision making: selecting a course of action from among alternatives
What should be selling? Whom should we be serving? How should we execute?
-Identify the major differences and similarities between financial and managerial
accounting
Managerial accounting -
-provides information to managers
-provides data that helps organizations run more efficiently
-determine and develop internal accounting information and various reports
Financial accounting -
-provides information to shareholders, creditors, and other outsiders
-provides scorecard by which a company’s past performance is judged
-produces a limited set of specific quarterly and annual financial statement in
accordance with GAAP and government regulations
Differences:
Emphasis on the future
-financial accounting assembles past data
-managerial accounting assembles current and future estimated data
Relevance of data
-financial accounting, data must be objective and verifiable
-managerial accounting, all relevant data are gathered even if they can’t be
verified
Less emphasis on precision for managerial accounting (saves time, money)
1
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