Assignment: Analyzing Financial Statements For Planning And Cost
You have recently hired a new assistant, Susan Thompson, who previously worked in a financial accounting office preparing journal entries, which provide you with a recording of the day-to-day activities of the company and financial statements (income statement, statement of owners' equity balance sheet, and cash flow statement). Although your new assistant has experience with and fully understands financial accounting, she has no experience with managerial accounting.
Part 1
In a memo to your new assistant, Susan Thompson, complete the following:
• Explain to her the similarities and differences between financial and managerial accounting.
• Provide examples of managerial accounting reports that she could expect to see within EEC, and explain how management might use the information to make decisions.
o Keep in mind that although the income statement, the statement of owners' equity balance sheet, and the cash flow statement are generated in financial accounting, they are used to develop all of your managerial accounting reports.
o Examples of a few of those reports are the horizontal analyzes, vertical analyzes, and ratios.
Part 2
In a memo to the board of directors, discuss the information found in each of the following financial statements, and describe how accounting information is used by managers for planning and control:
• Balance sheet
• Income statement
• Statement of cash flows
• Statement of stockholders' equity
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.