Preview

Intro to Management Accounting

Powerful Essays
Open Document
Open Document
638 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Intro to Management Accounting
Managerial Accounting Overview
BA 115

Management Accounting

Measures, analyzes, and reports financial and non financial information non-financial that helps managers make decisions to fulfill the goals of an organization organization.

Activity

IFRS/IAS-based Financial Reports

Generally, cannot be used for the day-to-day d t d goals of the managers.

Financial vs Managerial Acctg
MANAGERIAL
Primary users Focus and emphasis Rules of measurement and reporting Level of detail Managers (Internal) Future-oriented Need not follow GAAP Emphasizes detailed segment reports about departments, products, and customers. Emphasizes relevance. Emphasizes timeliness.

FINANCIAL
External users Past-oriented Must follow GAAP Emphasizes summary data concerning the entire organization Emphasizes objectivity and verifiability. d ifi bilit Emphasizes precision.

Other points of emphasis

What is Cost?

Cost is a resource sacrificed or forgone to achieve a specific objective (i.e., not necessarily for profit).

General Cost Classifications
Classification on the financial statements
UNEXPIRED
Balance Sheet

EXPIRED
Income statement

PRODUCT
Inventoriable

PERIOD
Expensed

General Cost Classifications
Classification on the financial statements
PRODUCT
Inventoriable

DIRECT MATERIALS
Prime Cost

DIRECT LABOR MFG OVERHEAD
Conversion Cost

General Cost Classifications
Classification on the financial statements
PERIOD
Outright expensed

SELLING ADMINISTRATIVE

General Cost Classifications
Classification for Assigning Costs to Cost Objects
• Costs are assigned to cost objects for a variety of purposes including pricing, preparing profitability studies, and controlling spending spending. • A cost object is anything for which cost data are desired – including products, customers, jobs, and organizational sub-units. b it

General Cost Classifications
Classification for Assigning Costs to g g Cost Objects
DIRECT
Cost that
Continue Reading
View Writing Issues

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Hca/270 Appendex D
    • 290 Words
    • 2 Pages

    Hca/270 Appendex D

    | A cost that varies depending on the output and sales of the company. Examples of this would be raw materials and energy usage.…

    • 290 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Best Essays

    Sarbanes Oxley Act
    • 3132 Words
    • 13 Pages

    Sarbanes Oxley Act

    These two practices were GAAP, which stands for Generally Accepted Accounting Principles and GAAS, which stands for Generally Accepted Auditing Standards. Creditability was the basic foundation for both of these principles, but had to be enforced with the Sarbanes Oxley Act when corporate scandals became prevalent. In order to gain a better understanding of SOX, which has superseded the rules of GAAS and GAAP, an analysis was conducted on four issues that relate to the Act. The four issues at hand are: the CEO’s and CFO’s of public companies, Section 404 on internal control, the main advantages and disadvantages, and what changes should be made to SOX. Finally, a discussion about how legislation cannot guarantee the accuracy of public financial statements will be examined. Along with this issue, Team Nitpickers will dig deeper and look into reasons as to why CEO’s and CFO’s are paying closer attention to this law.…

    • 3132 Words
    • 13 Pages
    Best Essays
    Read More
  • Satisfactory Essays

    Fasb System Orientation
    • 740 Words
    • 3 Pages

    Fasb System Orientation

    The purpose of this paper is to determine why the Financial Accounting Standard Board (FASB) set-up the codification of Generally Accepted Accounting Principles (GAAP). In the following paragraphs the purpose and reason are defined. The break-down of the nine main areas are described with a break-down of each area. An accounting professional will use these areas many times in his or her career, so the knowledge offered is important.…

    • 740 Words
    • 3 Pages
    Satisfactory Essays
    Read More
  • Powerful Essays

    Rsm220-Week 01 Slides
    • 2259 Words
    • 10 Pages

    Rsm220-Week 01 Slides

    1. Identification, measurement, and communication of financial information about; 2. Economic entities to; 3. Interested persons.…

    • 2259 Words
    • 10 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Nur 571 Generally Accepted Accounting Principles
    • 1005 Words
    • 5 Pages

    Nur 571 Generally Accepted Accounting Principles

    Increasing pressures of cutting costs and improving the quality of care in health care services influences the management of the health care organization to implement the generally accepted accounting principles (GAAP) within their daily routines. Generally accepted accounting principles (GAAP) are a set of uniform accounting guidelines health care organizations follow to determine the financial position of an organization. According to Finkler, Kovner, and Jones (2007) the most common and important GAAP are as follows: (a) Entity concept, (b) Going-concern concept, (c) Matching principle and cash versus accrual counting, (d) Cost principle, (e) Objective evidence, (f) Materiality, (g) Consistency, and (h) Full disclosure. This paper provides a brief description as well as the intention behind each principle as well as how each principle relates to health care.…

    • 1005 Words
    • 5 Pages
    Powerful Essays
    Read More
  • Good Essays

    By the 1850's the Constitution became a source of sectional discord, ultimately contributing to the failure of the union. This tries to disprove this statement. *AP US DBQ from 1987
    • 1469 Words
    • 4 Pages

    By the 1850's the Constitution became a source of sectional discord, ultimately contributing to the failure of the union. This tries to disprove this statement. *AP US DBQ from 1987

    In the mid-1800's, many events occurred that increased sectional tension between the Northern and Southern states of the Union. These tensions ultimately resulted in the outbreak of civil war. One thing in particular that is considered to be a source of sectional discord is the U.S. Constitution. However the Constitution itself was not a source of sectional tension that caused the failure of the Union. The failure erupted generally from the issue of slavery. combination of the people in general and the differences in economic styles that lead to the downfall. Poor political decisions such as the Kansas Nebraska Act, lead to bad decisions which worsened the tensions of the union. The economic differences ultimately lead to the Civil War because it was the driving force that caused the differences between the North and The South.…

    • 1469 Words
    • 4 Pages
    Good Essays
    Read More
  • Better Essays

    Financial Statements Ifrs vs. Gaap
    • 1606 Words
    • 7 Pages

    Financial Statements Ifrs vs. Gaap

    For those in the business world, particularly in the accounting field, a major issue has surfaced in recent years relating to the differences between Generally Accepted Accounting Principles (GAAP) and the International Financial Reporting Standards (IFRS). Currently, the majority of countries in the world follow International Financial Reporting Standards guidelines; however, the United States still uses GAAP. This topic has been a main focus because there is a plan for convergence between the two frameworks in the near future. The United States accounting system will undergo drastic changes when this occurs, but in the long-run the idea is to simplify the accounting procedures around the world. “Through these projects, some covering major components of the financial statements, the boards intend to improve financial reporting information for investors while also aligning US and international accounting standards. These projects are a significant move toward achieving a common accounting framework, a necessary step in the globalization of business and investment” (PriceWaterhouseCoopers LLP, 2011). The main difference between GAAP and IFRS is that GAAP is considerably rule-based, whereas IFRS is more principal-based which means IFRS has room for interpretation. The specific differences are far too many to cover in a short presentation, however, an explanation of some major differences are mentioned below.…

    • 1606 Words
    • 7 Pages
    Better Essays
    Read More
  • Good Essays

    Hcs 405 Financial Reporting Practices And Ethics Research Paper
    • 878 Words
    • 4 Pages

    Hcs 405 Financial Reporting Practices And Ethics Research Paper

    GAAP are a combination of authoritative standards (set by policy boards) and simply the commonly accepted ways of recording and reporting accounting information” (Generally Accepted Accounting Principles , n.d.). Even with GAAP being a set of standards, there are still companies that will finagle numbers on their financial statements, so their financial statements will have to be scrutinized…

    • 878 Words
    • 4 Pages
    Good Essays
    Read More
  • Best Essays

    The Pros and Cons of Setting Separate Private Company Accounting Standards
    • 956 Words
    • 4 Pages

    The Pros and Cons of Setting Separate Private Company Accounting Standards

    In USA, there are a large number of nonpublic companies, much more than public companies. As time goes, deficiencies exist in current GAAP to meet nonpublic companies to make financial reporting. GAAP is extremely complex and onerous to nonpublic companies. Those private companies frustrated with being forced to spend a great amount of money on valuating intangible property, or spending hours on disclosures that users may not read. Therefore, private companies’ owners cry for a sufficient and appropriate accounting standards meet their needs.…

    • 956 Words
    • 4 Pages
    Best Essays
    Read More
  • Satisfactory Essays

    Commercial Accounting and (Gaap)
    • 489 Words
    • 2 Pages

    Commercial Accounting and (Gaap)

    Generally Accepted Accounting Principles better known as (GAAP) is the collection of standards and practices that are required to be used by business’s to record and present the results of their financial activities and their records of what they owe, established by the Financial Accounting Standards Board (FASB). These accounting principles are standardized and used for the many private and publicly traded companies in America today. Every economic event within business must be associated with and recorded by a specific entity and business records must not include the personal assets or liabilities of the owner. If an idea holds no impact on a decision maker, investors, or creditors, then the relating (GAAP) principles do not have to be followed. (GAAP) requires the use of accrual basis accounting rather than cash basis accounting, this is imposed on businesses so that investors have a minimum level of consistency in the financial statements they use when analyzing businesses for investment purposes.…

    • 489 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Good Essays

    Accounting Standards Codification Essay
    • 821 Words
    • 4 Pages

    Accounting Standards Codification Essay

    Previously, the documents that detailed the rules and regulations of the Generally Accepted Accounting Principles (GAAP) varied in structure, format, and completeness. These variations led to confusion among users and it became more difficult to determine if they were using GAAP correctly. In response to this problem, the FASB developed the Accounting Standards Codification (ASC) whose main purpose is to provide users access to all of the generally accepted accounting principles in one place. The Codification eliminates obsolete information and presents all of the material in the same format and structure. The Codification is now considered the authoritative source for GAAP for all nongovernmental entities.…

    • 821 Words
    • 4 Pages
    Good Essays
    Read More
  • Powerful Essays

    Accounting Reporting Criteria: GM and Toyota
    • 1275 Words
    • 6 Pages

    Accounting Reporting Criteria: GM and Toyota

    GAAP (Generally Accepted Accounting Principles) were established by the FASB, which has been given the authority to monitor and enforce these regulations. These regulations include consistency, relevance, reliability and comparability. To be consistent, all information gathered must be the same throughout all periods and have relevant meaning so those using the information can make educated guesses regarding the stability of the company. In addition, the information must be verifiable and comparable to other companies in the industry. (Bradford, 2007).…

    • 1275 Words
    • 6 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Critical Review of Principles-Based Accounting Standards
    • 1324 Words
    • 6 Pages

    Critical Review of Principles-Based Accounting Standards

    Schipper (2003) demonstrated that there was a long-running debate on whether U.S. GAAP should be shifted to principles-based system instead of rules-based system. To measure its applicability, SEC and FASB had conducted a study and developed a proposal respectively. Schipper (2003) argued that U.S. GAAP was based on principles guided by FASB Conceptual Framework. He used examples to explain how U.S. GAAP achieved relevance, reliability and comparability. In addition, Schipper (2003) illustrated why a recognisable principle became complex and detailed by giving instances. In situations, a recognisable principle needs additional guidance and explanation to support. Schipper (2003) showed that scope exceptions, treatment exceptions and detailed implementation guidance made U.S. GAAP appeared to be rules-based standards and stressed on implementation guidance. Furthermore, Schipper (2003) discussed potential consequences of adopting principles-based standards. Generally, Schipper (2003) held the point that shifting U.S. GAAP to principles-based standards and abandoning rules-based standards were not appropriate.…

    • 1324 Words
    • 6 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    From Cost Center to Profit Center
    • 2134 Words
    • 9 Pages

    From Cost Center to Profit Center

    A cost center is a unit of an organization that generates expenses and has no responsibility for generating revenue. The only expectation a cost center has…

    • 2134 Words
    • 9 Pages
    Powerful Essays
    Read More
  • Satisfactory Essays

    Practice Of Accounting In Bangladesh
    • 267 Words
    • 2 Pages

    Practice Of Accounting In Bangladesh

    1.Financial accounting: Limits its activities in recording business transaction and determining financial results and position.…

    • 267 Words
    • 2 Pages
    Satisfactory Essays
    Read More

Related Topics