Solution to topic 1 tutorial

Solution to topic 1 tutorial - SOLUT ION TO TOP IC 1 TUTOR...

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Unformatted text preview: SOLUT ION TO TOP IC 1 TUTOR IAL TOP IC: I ntroduction & Cost terms 1-6 Four important differences between managerial accounting and financial accounting are listed below: (a) Managerial-accounting information is provided to managers within the organization, whereas financial-accounting information is provided to interested parties outside the organization. (b) Managerial-accounting reports are not required and are unregulated, whereas financial-accounting reports are required and must conform to generally accepted accounting principles. (c) The primary source of data for managerial-accounting information is the organization's basic accounting system, plus various other sources. These sources include such data as rates of defective products manufactured, physical quantities of material and labor used in production, occupancy rates in hotels and hospitals, and average takeoff delays in airlines. The primary source of data for financial-accounting information is almost exclusively the organization's basic accounting system, which accumulates financial information. (d) Managerial-accounting reports often focus on subunits within the organization, such as departments, divisions, geographical regions, or product lines. These reports are based on a combination of historical data, estimates, and projections of future events. Financial-accounting reports focus on the enterprise in its entirety. These reports are based almost exclusively on historical transaction data. 1-26 1. Data about the cost of maintaining the machine weekly or biweekly would be relevant. In addition, the production manager should consider information about the likely rates of defective products under each maintenance alternative. 2. Estimates of the cost of lost merchandise due to shoplifting and the cost of employing security personnel would be relevant to this decision....
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This note was uploaded on 09/19/2011 for the course ACCOUNTING 211 taught by Professor Min during the Three '11 term at Curtin.

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Solution to topic 1 tutorial - SOLUT ION TO TOP IC 1 TUTOR...

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