100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Summary FBS222 - Chapter 1 - Introduction to Managerial Accounting R50,00   Add to cart

Summary

Summary FBS222 - Chapter 1 - Introduction to Managerial Accounting

 8 views  1 purchase

Comprehensive summary of the introduction to managerial accounting (chapter 1), adapted from the book, Cornerstones of Managerial account. ISBN: 3542

Preview 2 out of 9  pages

  • No
  • Chapter 1
  • August 26, 2022
  • 9
  • 2022/2023
  • Summary
book image

Book Title:

Author(s):

  • Edition:
  • ISBN:
  • Edition:
All documents for this subject (1)
avatar-seller
kaylahumphries
FBS 222 CHAPTER 1



Introduction to Managerial Accounting

MEANING
• Managerial accounting = providing accounting information for a company’s
internal users.
• Unlike financial accounting, managerial accounting is not bound by any formal
criteria such as generally accepted accounting principles (GAAP).
• Companies release information to the public through corporate sustainability
reports, social responsibility reports or citizen reports.
o To manage reputation.
• Three broad objectives:
o Planning
o Controlling
o Decision-making




OBJECTIVES
• To provide information for planning the organisation’s actions.
• To provide information for controlling the organisation’s actions.
• To provide information for making effective decisions.



Planning
• The detailed formulation of action to achieve a particular end.
• Requires setting objectives and identifying methods to achieve objectives:

Setting objectives Identifying methods to achieve objectives


• New methods should be clearly specified and detailed.



Controlling
• Managerial activity of monitoring a plan’s implementation and taking
corrective action as needed.


KAYLA HUMPHRIES

, FBS 222 CHAPTER 1

• Compare actual performance and expected performance.
o Information used to evaluate/correct steps taken to implement the
plan.
• Can be financial or non-financial in nature.
o Feedback given to managers in the form of performance reports that
compare actual data with planned data/benchmarks.



Decision Making
• The process of choosing amoung competing alternatives.
• Managerial accounting information systems supply information that facilitates
decision making.



FINANCIAL VS MANAGERIAL
ACCOUNTING
Financial Accounting Managerial Accounting
Extremely focused Internally focused
Must follow externally imposed rules No mandatory rules
Objective, financial information Financial and non-financial information,
subjective information possible
Historical orientation Emphasis on the future
Information about the firm as a whole Internal evaluation and decisions based
on very detailed information
More self-contained Broad, multidisciplinary



FINANCIAL ACCOUNTING
• Financial accounting provides historical information for external users such as:
o Investors, creditors, customers, suppliers etc.
• Financial statements must follow rules defined by:
o Securities and Exchange Commission (SEC)
o Financial Accounting Standards Board (FASB)
o International Accounting Standards Board (IASB)
▪ These rules pertain to issues such as: timing of expenses,
recording of assets, recognition of revenues etc.


KAYLA HUMPHRIES

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying this summary from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller kaylahumphries. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy this summary for R50,00. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

85443 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy summaries for 14 years now

Start selling
R50,00  1x  sold
  • (0)
  Buy now