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Cost Accounting vs Financial Accounting

Cost Accounting vs Financial Accounting

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Published by ClassOf1.com
Looking for customized help with your cost accounting assignments? Visit http://classof1.com/homework-help/cost-accounting/

Differences between Cost Accounting and Financial Accounting:
This academic work talks about what is cost accounting. And it delves deeper into what is the similarities and differences when compared with Financial Accounting.
Looking for customized help with your cost accounting assignments? Visit http://classof1.com/homework-help/cost-accounting/

Differences between Cost Accounting and Financial Accounting:
This academic work talks about what is cost accounting. And it delves deeper into what is the similarities and differences when compared with Financial Accounting.

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Categories:Types, School Work
Published by: ClassOf1.com on Mar 26, 2014
Copyright:Traditional Copyright: All rights reserved

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03/26/2014

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Cost ccounting
 
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The Homework solutions from Classof1 are intended to help students understand the approach to solving the problem and not for submitting the same in lieu of their academic submissions for grades.
Subject: Cost Accounting
 
Cost Accounting vs Financial Accounting
Cost accounting can be defined as a process which involves collection, evaluation and summarizing various courses of action. The main aim is to shed light on the best possible course of action which will help to attain efficiency and effectiveness in terms of cost. Cost accounting strives to produce the cost structure in detail so that the management is able to tame the production and plan for the coming days with ease and flexibility. This information is very vital as it helps in the decision making process and facilitates preparation of financial reports.
 What are the similarities between CA and FA?
 
Cost accounting as well as financial accounting have the same base and use the same terms. For example the concept of debit and credit can be found in both of them. Under both of these the accounts are classified which consists of assets, liabilities etc.
 
Financial accounting is mainly used for producing reports which consist of  various financial statements such as balance sheet, profit and loss account, cash flow statements, etc. This information is used by the department of cost accounting to decide the internal course of action and prepare strategies accordingly.
 
Both cost and financial accounting are bent on enhancing the performance of the company.
 
 *
The Homework solutions from Classof1 are intended to help students understand the approach to solving the problem and not for submitting the same in lieu of their academic submissions for grades.
Subject: Cost Accounting
 
The differences:  What do they help us determine
? Financial accounting helps to arrive at the financial reports which consists of income statements, balance sheet, cash flows, etc. through it the evaluation and prediction is possible. On the contrary, through the help of cost accounting it becomes easy to allocate costs and hence the control of cost can be easily done.
 Who does it help?
Financial accounting helps the internal as well as external parties. The parties such as investors, government, media needs to know about the performance, which can be known by the financial reports such as income statements, balance sheet etc. Cost accounting helps the internal management to determine the extent of control so that there is proper allocation of cost and cost control.
How does it classify things?
In cost accounting the classification is done on the basis of man, material and direct as well as indirect expenses. The elements of cost, profit and price is generated. Financial accounting classifies things on the basis of financial information and records which is generated. Only the monetary aspects are recorded and taken into consideration while the non-monetary aspects are ignored.
 When is it presented?
Financial accounting is done annually to determine the profit or loss on the other hand cost accounting is done periodically to know the cost information.

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