Question

"Perception" Please respond to the following: You have been immersed in the world of managerial accounting (i.e., cost accounting) for seven (7) weeks. At this point in the course, what is your assessment of cost/managerial accounting from a provider perspective? Now imagine that you are the user, not the provider. Explain whether or not your assessments have changed, and explain why or why not. As a user, describe how you would use two (2) of the variances calculated to make better management decisions.

Answer 1

Cost Accounting is provide a basic for operating policies which may be determination of cost volume relationship, whether to manufacture or buy from market, Weather to continue the exixsting method of production or to replace it by a more improved method of production….. etc

As a provider my assessment is A cost system provides ready figures for use by the Government, Wage tribunals and boards, and labour and trade unions.

Cost accounts furnish suitable data and information to the management to serve as guides in making decisions involving financial considerations.

As a user my assessment is to determine the selling prices under different circumstances, It provides information to the management for proper planning , operation, control and decision making. It records the expenditure in an objective manner i.e according to the purpose for which the costs are incurred, Cost accounting is the part of financial accounts and discloses profit or loss of each products, job or service.

My assessment was not changed in the two perception because the cost Accounting is a important tool to make management decisions.

As we told earlier it helps to take effective magement decisions by application of Standard Costing and Bugetory Control Methods.