Managerial Accounting

The video explains the differences between managerial and financial accounting. Managerial accounting is aimed at internal users like managers and focuses on future-oriented, relevant data for decision-making. It does not require precision or adherence to standards like GAAP. Financial accounting, on the other hand, targets external users such as investors, focuses on past activities, and requires precise, verifiable data. It must comply with GAAP and reports on the company as a whole. Managerial accounting is optional, while financial accounting is mandatory for tax purposes.

Who are the primary users of managerial accounting information?

• Government Agencies

• Managers

• Creditors

• Investors

What is the main focus of managerial accounting in terms of time horizon?

• Historical data

• Current activities

• Future planning

• Past activities

Which type of accounting requires data to be objective and verifiable?

• Tax accounting

• Cost accounting

• Financial accounting

• Managerial accounting

In terms of reporting units, how does managerial accounting differ from financial accounting?

• Reports on the entire company

• Reports on company segments

• Reports on international standards

• Reports on tax obligations

Which accounting type is required to follow GAAP?

• Financial accounting

• Managerial accounting

• Neither managerial nor financial accounting

• Both managerial and financial accounting