MA 1 difficile aperto

Financial accounting has a primary focus on companywide reports, must follow GAAP/IFRS and prescribed formats, and is mandatory for external reports. Managerial accounting focuses on segment reports, is not bound by GAAP/IFRS or any prescribed format, and is not mandatory.

Managerial accounting involves planning, controlling, and decision-making activities, such as establishing goals, developing budgets, and making selections among competing alternatives. Financial accounting is focused on external persons making financial decisions, with a historical perspective and emphasis on objectivity and verifiability.

To become a Certified Management Accountant (CMA), membership in the Institute of Management Accountants, a bachelor's degree, two years of relevant professional experience, and passage of the CMA exam are required.

<p>The CMA exam content specifications cover topics such as financial reporting, planning, performance, and control, as well as financial decision-making, risk management, and professional ethics. The Chartered Global Management Accountant (CGMA) designation requires a bachelor's degree in accounting, passage of the CPA exam, membership in the AICPA, three years of relevant management accounting work experience, and passage of the CGMA exam.</p> Signup and view all the answers

<p>Employers expect accounting majors to have strong financial accounting skills, as well as the planning, controlling, and decision-making skills foundational to managerial accounting.</p> Signup and view all the answers

<p>The Institute of Management Accountants (IMA) estimates that over 80% of professional accountants in the U.S. work in non-public accounting environments.</p> Signup and view all the answers

<p>The break-even quantity is the level of sales at which total revenues equal total costs, resulting in zero profit. It can be determined using the formula: $Q_{BE} = \rac{Fixed \ Costs + Targeted \ Profit},{Selling \ Price - Variable \ Cost \ per \ Unit}$.</p> Signup and view all the answers

<p>The degree of operating leverage (DOL) measures the percentage change in profit associated with a change in volume or sales. It is calculated using the formula: $DOL = \rac{Contribution \ Margin},{Net \ Operating \ Income}$.</p> Signup and view all the answers

<p>Managers typically assume constant selling price, linear costs, and constant product mix for CVP calculations.</p> Signup and view all the answers

<p>The contribution margin is the amount remaining from sales revenue after variable expenses have been deducted. It helps in assessing the impact on profits of changes in selling price, cost, or volume.</p> Signup and view all the answers

<p>The contribution format income statement can be expressed in the equation: $Sales - Variable \ Expenses = Contribution \ Margin - Fixed \ Expenses = Net \ Operating \ Income$.</p> Signup and view all the answers

<p>The margin of safety indicates how safe the company is in terms of reaching the break-even point, providing insight into the risk associated with current sales levels.</p> Signup and view all the answers

<p>Financial accounting serves external parties like stockholders, creditors, and regulators, while managerial accounting provides information to internal managers for planning, control, and decision-making.</p> Signup and view all the answers

<p>Cost classification serves purposes like assigning costs to cost objects, accounting for costs in manufacturing, predicting cost behavior, and making decisions.</p> Signup and view all the answers

<p>Direct costs are easily traced to a unit of product or cost object, such as direct material and direct labor, while indirect costs cannot be easily traced to a unit of product and include manufacturing overhead.</p> Signup and view all the answers

<p>Common costs are incurred to support multiple cost objects and cannot be directly associated with a single cost object.</p> Signup and view all the answers

<p>Product costs include direct materials, direct labor, and manufacturing overhead and are relevant for evaluating cost of goods sold and inventory on financial statements.</p> Signup and view all the answers

<p>Direct materials costs are transferred from raw materials to work in process when used in production.</p> Signup and view all the answers

<p>Period costs include all selling and administrative costs and are assigned to the period when the cost is incurred. Product costs, on the other hand, are the costs directly associated with the production of goods and have two options to show up: in the income statement through cost of goods sold and in the balance sheet as cost of inventory.</p> Signup and view all the answers

<p>Variable costs vary in direct proportion to changes in the level of activity, while fixed costs remain constant regardless of changes in activity.</p> Signup and view all the answers

<p>Committed fixed costs are long-term and cannot be significantly reduced in the short term, while discretionary fixed costs may be altered in the short term by current managerial decisions.</p> Signup and view all the answers

<p>Relevant costs and irrelevant costs depend on the decision-making setting, and decisions involve choosing between alternatives. Differential costs are the difference in cost between any two alternatives and are always relevant to decisions.</p> Signup and view all the answers

<p>Opportunity cost is the potential benefit given up when one alternative is selected over another and should be explicitly considered in every decision.</p> Signup and view all the answers

<p>Sunk costs have already been incurred and cannot be changed now or in the future, and should be ignored when making decisions.</p> Signup and view all the answers

<p>The main difference is that managerial accounting addresses the internal audience of management and provides quantitative information for decision-making, while financial accounting is more focused on providing detailed information for external stakeholders such as investors and creditors.</p> Signup and view all the answers

<p>The audience for managerial accounting information is the management, from the top management to the operating level within the organization.</p> Signup and view all the answers

<p>Managerial accounting provides quantitative information that is used at all levels of the organization, and the management typically requires aggregate measures of the company rather than detailed information.</p> Signup and view all the answers

<p>The scope of managerial accounting is broader and does not have specific accounting principles governing the presentation of information, unlike financial accounting which follows generally accepted accounting principles (GAAP).</p> Signup and view all the answers

<p>The key tasks in managerial accounting include working with numbers, collecting data, organizing, and classifying data to provide relevant information for decision-making by the management.</p> Signup and view all the answers

<p>Managerial accounting has free formats for presenting information, while financial accounting follows specific accounting principles and standards for organizing and presenting information.</p> Signup and view all the answers