Cost Chpt 1 notes

Cost Chpt 1 notes - Cost Accounting Notes January 10th 2012...

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Cost Accounting Notes January 10 th 2012 Chapter 1 Management Accountants: - Their Vital Role in Strategic and Operating Decisions How Cost Accounting Supports Decisions: - Economic events and transactions are processed into useful information - Accounting systems organize information into reports and statements - Managers use accounting information to: - Administer activities and functional areas - Coordinate activities within the entire organization - Managers need information in different forms - Management Information Systems (MIS) comprise databases that store information for many purposes Cost Accounting - Measures and reports financial and non-financial information - Relates to cost of acquiring or utilizing resources in an organization - Uses various techniques to provide reliable estimates of product cost - Provides information for management accounting and financial accounting Financial Accounting - Focuses on reporting to external parties -- investors, regulators and others - Uses a standardized format to: - Record business transactions - Report aggregate results to external users - Financial statements must be free from material misstatement - Compensation often tied to reported income Management Accounting - Focuses on reporting to internal parties - Uses a customized format to: - Report financial and non-financial information - Provide information useful to managers
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Cost Chpt 1 notes - Cost Accounting Notes January 10th 2012...

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