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ACCT 621 Managerial Accounting

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Management accounting is the practice of identifying, analyzing, measuring, interpreting, and communicating financial information to meet an organization's objectives. It differs from financial accounting because the main purpose of management accounting is to help the users of the company make wise business decisions.

Management accounting includes many aspects of accounting, which is to improve the quality of information about economic activity indicators transferred to management. Management accountants use information related to sales value and revenues from goods and services produced by a company. Cost accounting is a broad subcategory of management accounting that focuses on calculating the total production costs of a company by estimating variable and fixed costs at each stage of production. This allows the company to identify and reduce unnecessary costs and maximize profits.

A simple definition of management accounting is to provide managers with the financial and non-financial information they need to make decisions. In other words, management accounting can help the directors of an organization make decisions. This can also be called cost accounting. It is a method of identifying, validating, decoding data and presenting it to managers in order to achieve business goals. The information collected includes all areas of accounting that train the competent authority to identify business objectives related to the organization's financial costs and the decision-making process. Accountants use plans to measure the overall operating strategy of an organization.

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