The Fundamental Difference Between Managerial and Financial Accounting Is That

question 71

Multiple Choice

The fundamental difference between managerial and financial accounting is that

• A)all financial accounting information is audited by Certified Public Accountants whereas managerial accounting information is audited by the IMA.
• B)managerial accounting is concerned principally with budgets, whereas financial accounting is concerned with a wider range of the organization's activities.
• C)managerial accounting provides information for decision-makers within the organization, whereas financial accounting provides information for individuals and institutions external to the organization.
• D)financial accounting information follows U.S.Generally Accepted Accounting Principles, whereas managerial accounting information generally follows rules set forth by the Institute of Management Accountants.

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Definitions:

Economize

The action of reducing expenditure or efficiently managing resources to avoid waste and save money.

Foreclose

The legal process by which a lender takes control of a property from a borrower due to failure to meet the repayment terms of a loan.

Defaulted

Defaulted refers to the failure to fulfill an obligation, especially the failure to repay a loan on time or to meet a contractual condition, leading to possible legal penalties or loss of rights.

Equity of Redemption

The right of a mortgagor to reclaim property on which a mortgage exists by repaying the debt before a foreclosure sale.