123 School Work

financial and managerial accounting

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  1.     What is the basic difference in orientation between financial and managerial accounting?
  Managerial accounting consists of providing information to managers within the organization. Financial accounting presents information to those outside the company, including stockholders and creditors. The type of data presented in both cases may differ, since there is a dissimilar interest in information's character.
  
  Table presented below is taken directly from the book (p.7 , ex. 1-2) and explains perfectly differences between these two types of accounting.
  
  Financial Accounting:               Managerial Accounting:
  * Prepares reports to those               * Prepares reports to those
  outside the organization :               inside the organization for: planning,     
  owners, lenders, regulators,               directing and motivating, controlling,
  tax authorities.                         Performance evaluation...