Submitted by: Submitted by Nishino1101
Views: 266
Words: 979
Pages: 4
Category: Business and Industry
Date Submitted: 09/16/2013 07:16 PM
Video 1: Financial vs Cost Accounting:
* Difference between Financial Accounting and Cost Accounting:
* Financial Accounting: 1) Communicates a firm’s financial position to external parties (Banks, Equity investors)
2) Past oriented: financial statements of the past
3) In accordance to GAAP [Generally Accepted Accounting Principles]
* Management Accounting: 1) Focuses on internal users, facilitates management decision making
2) More future oriented
3) Reporting according to need:
- Managers try to anticipate future business changes, which involve projections which is
why these reports tend to not follow rules
- Managers also want information not stipulated by GAAP
* Financial Reporting: is intended to provide information useful to making business economic decision in which users are involved.
* Accounting System Output: Whether it is financial or management, it should be informative.
* Key Questions: 1) How will this information help managers do their jobs better?
2) Does the benefit out-weigh the cost of producing the information?
* Cost Accounting: 1) Cost Accounting is a subset of management accounting
2) Provides information to both Financial and Management Accounting
3) Example: Cost of Good Sold Inventory (F.A.) also falls under cost accounting.
4) Measuring, reporting, and analyzing financial and non-financial information related to the cost of using
and acquiring resources
5) “Costing things”
* Modern Cost Accounting => Management Accounting
Video 2: Strategic Cost Management:
* Strategic Cost Management: Simply cost management that focuses on strategic issues:
* Strategy: Strategy specifies how an organization matches its own capabilities with the opportunities in the marketplace to
accomplish its objectives.
1. Product differentiation: A firm adopting this strategy attempts to differentiate itself from other...