Management Accounting and Financial Accounting Differ in That Management Accounting

question 1

Multiple Choice

Management accounting and financial accounting differ in that management accounting information is prepared

• A)following prescribed rules.
• B)using whatever methods the company finds beneficial.
• C)for shareholders.
• D)to summarize the whole company with little detail.

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Definitions:

Error

A mistake or inaccuracy, which can occur in reasoning, perception, action, or judgment.

Judgment

The capability to reach reasoned decisions or sensible judgments.

Heuristic Thinking

A cognitive process that simplifies decision making by using practical methods or experiential rules of thumb, often at the cost of accuracy or thoroughness.

Elimination by Aspect Heuristic

A decision-making process where alternatives are discarded by systematically evaluating them against a set of criteria.