Chapter 18, Problem 1QS

To determine

Introduction:

Managerial Accounting versus Financial Accounting:

Managerial accounting refers to the system that helps the managers with relevant information to develop strategies and make policies and plans that are useful in decision making for the effective operation of the business. On the other hand financial accounting refers to the system that focuses mainly on presenting the true and fair financial statement and reports to the stakeholders of the company.

Managerial accounting is concerned only with internal management and does not comply with any specific standards while there are various accounting standards established to be adhered by finance managers in preparing financial statements and reports.

To state:

The type of accounting whether it relates to managerial accounting or financial accounting based on their description.