Skip to content

CA Intermediate · Cost and Management Accounting · Introduction to Cost and Management Accounting

Which of the following best describes the role of management accounting as distinct from cost accounting?

Management accounting provides management with cost and non-cost information for planning, decision-making and control, and it includes forward-looking data. Merely ascertaining product cost is cost accounting, and statutory reporting to shareholders is financial accounting.

  1. AIt provides information to management for planning, decision-making and control, using both cost and non-cost dataCorrect
  2. BIt deals only with ascertaining the cost of products
  3. CIt is a statutory requirement to record transactions for shareholders
  4. DIt is limited to historical data and excludes forecasts

Explanation

Management accounting supplies management with financial and non-financial information for planning, decision-making and control, and uses forecasts. Cost ascertainment alone is cost accounting. Statutory reporting to shareholders is financial accounting.

Did you get it right without looking?

One question tells you little. A timed set on Introduction to Cost and Management Accounting shows your real accuracy, how long you take and where you lose marks.

Practise Introduction to Cost and Management AccountingFree diagnostic mock

More Introduction to Cost and Management Accounting questions