Professional Documents
Culture Documents
MS06 01 Introduction To MAS
MS06 01 Introduction To MAS
San Sebastian
Lipa City, Batangas, Philippines
Mobile : 0927 283 8234
Telephone : (043) 723 8412
Gmail : icarecpareview@gmail.com
Business organizations are normally not under the supervision of its owners and investors. These
individuals opt to entrust the operations of the organization to its management. Due to this trust given to
them by the owners, managers must ensure organization’s objectives are met by planning, organizing,
leading, and controlling various tasks of the organization.
In order to properly perform its function as management, managers are required to have relevant and
reliable information which would serve as the basis of their day to day decisions. Due to this need for
information, accountants are task to perform management accounting which is defined to be the branch
of accounting that aims to identify, analyze, interpret, and communicate various information to support the
management process.
FINANCIAL ACCOUNTING
1|P a g e JBUGATAN/JSARIPADA
No. 125 Brgy. San Sebastian
Lipa City, Batangas, Philippines
Mobile : 0927 283 8234
Telephone : (043) 723 8412
Gmail : icarecpareview@gmail.com
COST ACCOUNTING
INTERNAL Managers, at different levels, are the most common internal users of cost
USERS OF information. As defined in our basic management courses, managers are task to
COST perform the process of planning, leading, organizing and controlling tasks in order
INFORMATION to achieve company’s objectives. Due to this, managers are expected to use cost
information in order to plan and control business operations.
EXTERNAL There are various external users of cost information such as investors, employees,
USERS OF governments, and other parties. Take note that the primary characteristic common
COST to all external users is that they have limited access to information. As such, they
INFORMATION only rely on published reports regarding cost information. However, kindly take note
that these stakeholders have various objectives in dealing with cost information.
Financial accounting is the branch of accounting that is tasked to identify, analyze, interpret, and
communicate information to external users. Management accounting is the branch of accounting that is
tasked to identify, analyze, interpret, and communicate information to management. Both financial and
management accounting pertains to accumulation of information and communicating this information to its
various users. However, management accounting and financial accounting differs in various aspects as
illustrated in Table I.
2|P a g e JBUGATAN/JSARIPADA
No. 125 Brgy. San Sebastian
Lipa City, Batangas, Philippines
Mobile : 0927 283 8234
Telephone : (043) 723 8412
Gmail : icarecpareview@gmail.com
Regulation Optional and not regulated Required by various government agencies and
is regulated
Measurement Not limited to monetary value Limited to monetary value (historical peso
value)
Although there are differences between management and financial accounting, it must be noted that cost
accounting serves as the bridge between these two lines of accounting practice.
3|P a g e JBUGATAN/JSARIPADA
No. 125 Brgy. San Sebastian
Lipa City, Batangas, Philippines
Mobile : 0927 283 8234
Telephone : (043) 723 8412
Gmail : icarecpareview@gmail.com
2. Managers that are making economic decisions are more concerned with receiving information that is
a. Relevant, flexible and available immediately
b. Relevant, completely accurate and precise
c. Always financial in nature
d. Completely accurate and precise
3. Management accounting
a. Is concerned with financial information only
b. Focuses on the entirety of a business rather than the individual segments
c. Complies with external reportorial requirements
d. Is allowed to make use of the measurement and allocation bases in GAAP
5. The following are the differences of management accounting and financial accounting, except
a. Degree of estimates being used
b. Quality of financial data used in reporting
c. Governed by the PFRS
d. Deals with economic events
4|P a g e JBUGATAN/JSARIPADA
No. 125 Brgy. San Sebastian
Lipa City, Batangas, Philippines
Mobile : 0927 283 8234
Telephone : (043) 723 8412
Gmail : icarecpareview@gmail.com
11. A position in the organization chart that is directly related to achieving the basic objectives of an
organization is called:
a. a staff position.
b. a line position.
c. chief finance officer.
d. controller.
13. Deciding which alternative course of action is best suited to attain the set objectives is under what
management function?
a. Planning
b. Organizing
c. Controlling
d. Monitoring
5|P a g e JBUGATAN/JSARIPADA