Which of the following is true of managerial accounting?

a. Managerial accounting aims at providing information for controlling the organization's actions.

b. Managerial accounting provides historical information.

c. Managerial accounting is subject to rules for external financial reporting. d. Managerial accounting is the provision of accounting information for a company's external users.

Question

Business

Dickson

28 August, 19:09

Which of the following is true of managerial accounting?

a. Managerial accounting aims at providing information for controlling the organization's actions.

b. Managerial accounting provides historical information.

c. Managerial accounting is subject to rules for external financial reporting. d. Managerial accounting is the provision of accounting information for a company's external users.

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Answers (1)

Know the Answer?

Frye · Answer 1

The correct option is (a)

Explanation:

Managerial accounting is the process of estimating, analyzing and interpreting financial information for an organization's internal users mostly managers. Reports are tailored as per the requirement of managers and do not confirm to recognized standards like GAAP or IFRS.

These reports are prepared to control internal actions of organization to achieve organizational objectives. For example, certain budget reports to analyze cost activities could be sought by purchase department from the production department. These reports are meant for external reporting.