Unit 2 IP
January 24, 2013
In this discussion essay we will be discussing managerial accounting and the difference from cost accounting. We will learn what the lean production philosophy is. We will also go into depth about the difference between accounting principles in lean production to those of typical production. And lastly, we will discuss how to advise our Chief Administrator to prepare for a reduced budget.
Managerial and cost accounting are of great importance to any business, both forms of accounting help in the decision making process. They both help when analyzing how best to allocate a company’s scarce resources. Cost accounting is very important. It involves managerial accounting and makes up a vital component in helping to manage the cost and assets allocations. These two very important roles of accounting are nothing alike but are often confused in many cases. In this discussion we will be able to provide the reader with a clear understanding of the two forms of accounting, as well as give a details explanation on the purposes that they hold.
What is managerial accounting? Managerial accounting also referred to as management accounting is defined as producing accurate information in aiding a company’s management in the decision making process. This process is usually used as an input when dealing with planning projects. It is also used for evaluating how well a firm has done over a given period. When comparing the financial reports, it is very important for this technique to be used because it allows the accountant the opportunity to compare the current financial information with the previous information that was recorded. By using this technique it will show the company or firm how well the goals were met, if they were met or if any improvements need to be made. For most companies, they use management accounting for budgetary control, project planning, strategy...