ACCT1022 Chapter Notes - Chapter 1: Management Accounting, Cost Accounting, Continual Improvement Process

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25 Jan 2017
Department
Course
Professor
Managerial Accounting
Chapter 1: The Changing Role of Managerial Accounting in a Dynamic Business
Environment
Managerial Accounting: A Business Partnership with Management
The process of identifying, measuring, interpreting, and communicating information in
pursuit of an organization’s goals
An organization's management team seeks to create value for the organization by
managing resources, activities, and people to achieve the organization’s goals
effectively
Managerial accounts: specialists in helping the organization and managers run the
operation effectively
Managing Resources, Activities, and People
Goals
Board of Directors, elected by the company’s stockholders
In pursuit of goals, an organization
Acquires resources
Hires people
Engages in activities
Day to day work
Decision Making
Making decisions about operations
Choosing among the available alternatives
Planning
Developing a detailed financial and operational description of anticipated
operations
Directing operational activities
Running the organization
Controlling
Ensuring that the organization operates in the intended manner and
achieves its goals
Objectives of Managerial Accounting Activity
Providing information for decision making and planning
Assisting managers in directing and controlling operational activities
Using data
Comparing costs
Attention-directing function
Motivating managers and other employees towards the organization’s goals
Budgeting
Measuring the performance of activities, subunits, managers, and other
employees within the organization
Basis for rewarding
Positive feedback, promotions, and pay raises
Also divisions for economic investment
Assessing the organization’s competitive position, and working with other
managers to ensure the organization’s long-run competitiveness in its industry
Changes in business world all the time
Global competition
Continuous improvement
The Balance Scorecard
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