Acct 300 Essay

499 WordsMar 31, 20092 Pages
Utilizing the right accounting tool is important for your business to succeed. Accounting using the proper method is imperative to getting the information your company needs to make the appropriate financial decisions. There are many accounting principles that all serve their individual purpose. How you record you’re your financial transactions can be a major benefit or major detriment for your company. Managerial accounting and financial accounting are two accounting methods that will be further analyzed by our group. The major topics of this paper will include; the definitions of these principles, the specific characteristics of the he principles, the kind of information these methods provide, and the business situations where either managerial or financial accounting may be preferable over the other and who uses these specific methods. Managerial accounting provides information specifically to managers. This accounting method provides an inside look at the organizations finances. Budgets, Performance reports, information on costs, supply and demand is all specific characteristics that are included in managerial accounting. The information managerial accounting provides serves a strong purpose specifically to managers; this allows them to process, identify, measure, analyze, interpret and communicate the information. Many of their internal organizational goals are based on the information provided by managerial accounting. Users of managerial accounting include managers, but employees, board members, and executives A specific situation that may require, or rather be in the best interest of the company to use managerial accounting would be to guide their setting and selling of prices. Utilizing the product costs can not only be beneficial in product setting but also for inventory valuation and income determination ( Horgren and foster1). This specific

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