Question

Compare and contrast managerial accounting to financial accounting concerning who are the end users of the information, timeliness and accuracy of information, types of data contained in reports, and relevance. How will you use this in your career?There are three costs of a finished product; raw materials, direct labor and factory overhead. How do they flow through the manufacturing process and finally get assigned to the product? Compare and contrast product costs with period expenses.

Answer 1

2)Career wise, in managerial accounting, we prepare reports for the company's management and inform them about the company's operations. However, in financial accounting, we prepare reports for the banks, shareholders, creditors, board of directors, government agencies.

3)Raw material and direct labour are specifically identified with the product. We can find the total cost relating to material and labour directly attributable to the production of units.For raw materials, we multiply rate per unit of raw materials with number of units of raw material required. For, direct labour, we multiply, rate per hour of labour used with number of hours of labor used. Factory overheads are costs directly attributable for production of units , but other than raw material and labour, for example, fuel. Theses are computed using a predetermined overhead rate based on past operating efficiency.