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Management Accounting 1 (Introduction)

Management accounting notes

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15 views14 pages

Management Accounting 1 (Introduction)

Management accounting notes

Uploaded by

wannaseebutterfly01
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Introduction

Accounting
Branches of Accounting
Management Accounting concept
Accounting is concerned with determining
,measuring and analysing transactions and
Accounting events related to business and informing
their result to the different parties
interested in business.
▪ Accounting can be classified into
three main categories
▪ Financial accounting
Accounting
Branches ▪ Cost accounting
▪ Management accounting
▪ Financial accounting is concerned with
recording, classifying, and summarising
the business transactions so that at the
end of the year profit and loss can be
calculated and its Effects on owned
Financial capital ,asset and liability can be
Accounting ascertained.
▪ The function of financial accounting is to
prepare and present financial information
to the interested parties such as owners,
creditors, investors, employees, consumer
etc. So financial accounting is an external
▪ Objectives of financial accounting
▪ To determine the result of business
▪ To present the financial position of
business
Objectives
▪ To help in controlling the resources of
business and its operations and provide
information regarding preservation of
resources of business
▪ Costing is the classifying, recording and
appropriate allocation of expenditure for
the determination of the cost of
production or services and for the
presentation of data for the purpose to
Cost Accounting control and guidance of the management.
It deals with the cost of production and
selling and distribution . Under cost
accounting total cost of goods and the
elements of the total cost are studied.
▪ Cost determination
▪ To help management in cost control
Objectives ▪ To determine selling price
▪ To facilitate Managerial decision making
▪ Management accounting means
"Accounting for Management ".
Management accounting is the branch of
accounting which provide accounting
information to the management in a
Management systematic way so that managerial
Accounting function of planning, controlling and
decision making can be performed in a
efficient manner. Management accounting
play a significant role in day-to-day
business decision making .
Definition
▪ In Other words we can say that
,Management accounting Provides
Management necessary information to the
management to discharge its functions
Accounting
including organising ,planning ,directing
and controlling.
▪ It is a decision making system
▪ It is concerned with future

Features of ▪ It increases efficiency


▪ It is cause and effect analysis
Management
▪ It provides data ,not the decision
Accounting ▪ It is the technique of selective nature
▪ It uses special techniques and concepts
▪ Helpful in planning and formulating
policy
▪ Helpful in organising
▪ Motivating the employees

Objectives ▪ Helpful in decision making


▪ Helpful in controlling performance
▪ Helpful in interpretation of financial
information
▪ Helpful in tax administration
▪ Functions of management accounting
▪ Provides data
▪ Modifies data
▪ Analysis and interpretation of data
▪ use of qualitative information and also
▪ To help in planning
Functions
▪ To help in ororganising
To help in motivation
▪ To help in coordination
▪ To help in control
▪ To help in decision making
▪ Following are Include it in its scope
▪ Financial accounting
▪ Cost accounting
▪ Budgetary control
Scope ▪ Inventory control
▪ Statistical methods
▪ Taxation
▪ Internal Audit

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