Assignment On Goals Of Managerial Accounting

Added on - 30 Sep 2019

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Topic: What is the primary goal of managerial accounting?Keyword: Managerial AccountingManagerial Accountingis the process through which information is provided to themanagement of the organization for better decision making. Thus various costs, expenses,and revenues are measured, analyzed and interpreted for the managers to make informeddecisions about the activities of the organization. The most important difference betweenmanagerial accountingand financial accounting is that the latter is used for reporting to theoutside stakeholders of the company while the former assists in decision making within thecompany.Managerial accountinguses various forms of accounting which can help the decisionmakers take relevant decision based on the capability and goals of the organization. It helpsto provide the metrics related to the operations and conduct of the business. Informationrelated to the costs and expenditure helps to decide on the products and services offered bythe company at prices which meet the needs of the target customers. The data from suchmetrics are used to plan and prepare the budget which is an important aspect ofmanagerialaccounting. Any deviations from the planned performance metrics indicate a sign of changesto be made for the achievement of the goals.Margin Analysis and Managerial AccountingOne of the attractive features ofmanagerial accountingis that it helps to conduct marginanalysis for better decision making. Decisions regarding the selection of the projects andopportunities are important decisions as it can help the company build competitive advantagefor long term operations and performance. Including the aspect of margin, analysis helps thedecision makers to gauge even the intricate details required to take correct decisions at theright time.Managerial accountingincludes margin analysis, to ascertain the profits andcompare them with various types of costs. It helps in determining the price to be charged forper unit of products and service.There are a number of margins which need to be calculated for providing information formanagerial accounting. Some of the important ones include:Contribution Margin- This margin is calculated by deducting the variable expensesfrom the sales and dividing the figure by total sales amount. This margin has an
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