Chapter 18, Problem 1E

To determine

The source of information depends upon the types of business decisions that mean if the information is required for internal decision making purpose than management accounting system is useful. If the information is required for use of external decision makers, than the source is financial accounting system. If the information is used by both internal and external than both the accounting systems are useful.

Financial accounting emphasis on giving a true and fair picture of financial position of the company to various stakeholders whereas Management accounting emphasis on providing qualitative and quantitative data/ information to the management for decision making.

Some source of information may be obtained from Management accounting and some from financial statements. If some information are to be used for both external and internal purposes, than the information may be gathered from both accounting system.

In the given question, we have to identify the most likely information source for each business decision. Whether the source will be management accounts of financial accounts or it can be both the accounts.