Cost Accounting and Management Accounting

Question

Describe distinguish between the term Cost Accounting and Management Accounting?

Answer 1

1) The range of management accounting is wider than that of cost accounting.

2) Both the accounting statement is not a lawful.

3) Cost accounting offers merely cost information for managerial employ while management accounting offers all kinds of accounting information that is, cost accounting as well as financial accounting information.

4) In Cost accounting, the major importance is on cost ascertainment and cost control while in management accounting the major importance is on decision-making.

5) The different methods employed by cost accounting are standard costing, budgetary control, cost-volume-profit analysis and marginal costing, uniform costing and inter firm comparison, and so forth. While management accounting as well uses these methods but also uses methods like statistical analysis, funds flow statement, ratio analysis, and so forth.

6) Cost Accounting is a component of Management Accounting while Management accounting is an expansion of managerial facets of cost accounting with the final objective to keep the interests of the business.