Reference no: EM132283689

Question: Reply to students repsonce in 150 words

Managerial Accounting

- Focuses on data for internal processes distributed within the company and used for planning and operation effectiveness.

- Since it can address budgets and forecast, it can have future orientation.

- Do not have to comply with specific accounting standards

- Frequently relies on estimated data

- Reports can done more frequently and provide relevant information to managers to see right away

Financial Accounting

- Focuses on data creation for financial statements, which are distributed both within and outside of a company.

- Addresses historical data, business that already been conducted so it has historical orientation

- Mandatory to follow GAAP (Generally Accepted Accounting Principles) guidelines.

- Financial statements are issued following the end of an accounting period

- Financial accounting requires records of accurate data

Both path of accounting is crucial to any business. Management Accounting has great importance in fulfilling the needs of management to accomplish business objectives. The information given to the management is vital in addressing bottleneck issues and enhancing operation effectiveness. Financial accounting reports on the efficiency of a business.