When Comparing Management Accounting and Financial Accounting,which of the Following

question 51

Multiple Choice

When comparing management accounting and financial accounting,which of the following statements is FALSE?

• A) Management accounting has a future orientation whereas financial accounting has a past orientation.
• B) Management accounting prepares detailed reports whereas financial accounting prepares summary reports.
• C) Management accountants are constrained by the principles of reporting promulgated by the Institute of Management Accountants whereas financial accountants are constrained by Generally Accepted Accounting Principles.
• D) Behavioral considerations are of primary importance in management accounting, but not in financial accounting.

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Definitions:

Purchase Discounts

Reductions in price given by a supplier to a buyer for early payment within a specified period.

Purchase Discounts Lost

The additional expense a company incurs when it fails to take advantage of discounts offered by suppliers for early payment.

Voucher Register

A voucher register is a record keeping system where vouchers are indexed and stored, detailing the payment of a transaction.

Vouchers Payable

A liability account that records the obligation to pay for goods or services that have been received, but not yet paid for.