Chapter 1 - By Yolana Junco Yolana_junco@carleton.ca How...

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Unformatted text preview: By Yolana Junco Yolana_junco@carleton.ca How this course is structured? 4 modules The Foundation: strategy and cost terminology Cost systems: Job Order, Activity Based Costing, and Direct Costing systems Decision making: CVP Analysis, Relevant Costs and Pricing Control: Budgeting, Responsibility Accounting, Transfer Pricing and the use of Non-financial measures of performance Management vs. Financial Accounting Internal focus: provision o accounting information to management Level of details is much higher No fixed set of rules Leading indicators vs. lagging indicators of performance Includes non-financial information Focus on decision making and control Compar ing Manager ial and Financial Accounting Differences Financial Accounting Financial Accounting Managerial Accounting Managerial Accounting External users: shareholders, External users: shareholders, creditors, and regulators creditors, and regulators Financial statements Financial statements Quarterly and annually Quarterly and annually General-purpose General-purpose Pertains to business as whole Pertains to business as whole Highly aggregated Highly aggregated (condensed) (condensed) Limited to double-entry Limited to double-entry accounting and cost data accounting and cost data In accordance with generally In accordance with generally accepted accounting principles accepted accounting principles Audit by CA Audit by CA Primary Users Primary Users of Reports of Reports Types and Types and Frequency Frequency of Reports of Reports Purpose of Reports Purpose of Reports Content of Reports Content of Reports Verification Process Verification Process Internal users: officers and Internal users: officers and managers managers Internal reports Internal reports As frequently as needed As frequently as needed Special-purpose for specific Special-purpose for specific decisions decisions Pertain to subunits of the Pertain to subunits of the business business Very detailed Very detailed Extends beyond double-entry Extends beyond double-entry accounting to any relevant data accounting to any relevant data Standard is relevance to Standard is relevance to decisions decisions No independent audits No independent audits What management accounting is about? Cost systems: How much does it cost to provide a certain service, to manufacture a given product How much does it cost to run this course? Decision making How do we evaluate managers so that they work in the best interest of the firm? Managements activities and responsibilities can be classified into the following three broad functions: Decision-Making Controlling Controlling Directing Directing Planning Planning Decision making and Planning Planning decisions what tasks should be performed and how to complete them Control decisions how to manage,...
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This note was uploaded on 12/15/2010 for the course ACCT 1005 taught by Professor Mr during the Spring '10 term at Carleton CA.

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Chapter 1 - By Yolana Junco Yolana_junco@carleton.ca How...

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