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An overview of cost and management accounting- II
What is the primary objective of management accounting?
The primary objective of management accounting is to provide financial and non-financial information to internal management to aid in planning, decision-making, and control of business operations.
What is 'transfer pricing' in the context of management accounting?
Price charged when one department sells goods to another internally.
How does cost accounting differ from financial accounting?
Cost accounting focuses on recording, classifying, and analysing costs to aid internal management decisions, while financial accounting records all financial transactions to prepare statutory financial statements for external stakeholders.
What is 'opportunity cost' in cost accounting?
Benefit foregone by choosing one alternative over another.
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