Managerial Accounting Overview

Managerial Accounting Overview - Managerial Accounting...

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Managerial Accounting Overview Chapter 1 Managerial Accounting vs. Financial Accounting Work of Management: PlanningControlling Decision Making Planning: Establish goals Specify how goals will be achieved Develop budgets Controlling: the control function gathers feedback to ensure that plans are being followed Feedback in the form of performance reports that compare actual results with the budget are an essential part of the control function Decision Making: involves making a selection among competitive alternatives What should we be selling? Who should we be serving? How should we execute? Managerial Accounting Activities: Marketing Majors: Planning- How much should we budget for TV, print, and Internet advertising? How many salespeople should we plan to hire to serve a new territory? Controlling- Is the budgeted price cut increasing unit sales as expected?
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Are we accumulating too much inventory during the holiday shopping season? Decision Making- Should we sell our services as one bundle or sell them separately? Should we sell directly to customers or use a distributor? Supply Chain Management Majors: Planning- How many units should we plan to produce next period? How much should we budget for next period’s utility expense? Controlling- Did we spend more or less than expected for the units we actually produced? Are we achieving our goal of reducing the number of defective units produced? Decision Making- Should we transfer production of a component part to an overseas supplier? Should we redesign our manufacturing process to lower inventory levels? Human Resource Management Majors: Planning- How much should we plan to spend for occupational safety training? How much should we plan to spend on employee recruitment advertising?
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