Accounting 1 - Introduction to Management Accounting

Question 1

Management accounting - for internal or external use?

Answer 1

Internal use

Question 2

Management accounting - how should they be prepared and who sets the rules?

Answer 2

Presentation down to Company’s discretion as there are no rules

Question 3

Management accounting - which direction does it look; past or future?

Answer 3

Both, often past to inform future decisions

Question 4

Management accounting - how long to prepare and why?

Answer 4

Short

- need to be produced quickly to make quick decisions

Question 5

Management accounting - what information is it providing and to whom?

Answer 5

Greater detail at different points of the fiscal year

- to managers (to remain well-informed)

Question 6

Management accounting - how often prepared and how regularly?

Answer 6

Can be prepared whenever needed

- doesn’t have to be regular (weekly, monthly, quarterly etc)

Question 7

Financial accounting - for internal or external use?

Answer 7

External use

Question 8

Financial accounting - how should they be prepared and who sets the rules?

Answer 8

According to rules set by accounting profession and government(s)

Question 9

Financial accounting - which direction does it look; past or future?

Answer 9

Past

- based on fact so information based on past rather than future

Question 10

Financial accounting - how long to prepare and why?

Answer 10

Takes a long time to prepare

- requires whole-year info + careful methodical presentation

Question 11

Financial accounting - what information is it providing and to whom?

Answer 11

Provides a summary of the business’ performance

- shareholders, the public, financial regulators

Question 12

Financial accounting - how often prepared and how regularly?

Answer 12

Prepared at regular annual intervals