{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

C01 - ACCT 220 Management Accounting I Fall 2008 Instructor...

Info icon This preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon
Acct220 Fall 2008 1 ACCT 220: Management Accounting I Fall 2008 Instructor: Kirill NOVOSELOV, Ph.D.
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Acct220 Fall 2008 2 Introduction and Chapter 1 (Week 1) The plan: 1. Managerial vs. financial accounting 2. Overview of the course 3. Value of information 4. Cost accounting: Manufacturing and non-manufacturing costs Product and period costs Direct and indirect costs Fixed and variable costs Opportunity costs, sunk costs, out-of-pocket costs
Image of page 2
Acct220 Fall 2008 3 What is Accounting? the process of identifying, measuring, and communicating economic information to permit informed judgments and decisions by users of the information ( American Accounting Association ) Also: storing, classifying, aggregating, etc. I.e., the information should be helpful in making good decisions Notice that economic information can be both financial and non-financial
Image of page 3

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Acct220 Fall 2008 4 1. Financial vs. Managerial Accounting FINANCIAL ACCOUNTING Financial information Systematically collected and processed To help decision makers make better decisions Focus on aggregate information concerning the entire organization All data going into a firm’s financial statements: Income statement, Balance sheet Statement of cash flows For example: Revenues from sales, interest revenues, etc. Costs of goods sold and period expenses Value of assets – inventories, PP&E, etc. Value of liabilities – notes payable, etc. Cash receipts and cash disbursements Based on the balance sheet identity: A = L + E Regulated and mandatory Format is determined by regulations (GAAP or IFRS). Mandatory (for publicly traded firms); regulations determine what information the company must supply Emphasize objectivity and precision, frequently use historical data. Prepared for external users of information (individuals who are not part of the company). Shareholders or new investors use financial accounting information when deciding whether to buy or sell a company’s stock or bonds Banks use financial accounting information when deciding whether to lend money to a company, how much to lend, and what interest to charge
Image of page 4
Acct220 Fall 2008 5 1. Financial vs. Managerial Accounting MANAGERIAL ACCOUNTING Financial and non-financial information Systematically collected and processed To help decision makers make better decisions Detailed segment reports about departments, products, customers, and employees E.g., detailed product cost data: Depreciation Cost of new machinery Rent on factory or machinery Wages Cost of paper clips No underlying unity Many approaches are used depending upon the users’ (managers’) decision problem. Not regulated and not required No general principles or format that the company must follow.
Image of page 5

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 6
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern