Test bank managerial accounting by kieso weygandt 5e ch001

CHAPTER Managerial Accounting ASSIGNMENT CLASSIFICATION TABLE Study Objectives Questions Brief Exercises Exercises A Problems B Problems *1 Explain the distinguishing features of managerial accounting 1, 2, 1 *2 Identify the three broad functions of management 4, 5, 6, 7, 2, *3 Define the three classes of manufacturing costs 11, 12 4, 5, 2, 3, 4, 5, 1A, 2A 1B, 2B *4 Distinguish between product and period costs 13 3, 4, 5, 7, 13 1A, 2A 1B, 2B *5 Explain the difference between a merchandising and a manufacturing income statement 9, 14 8, 12, 13, 14, 15, 17 3A, 4A, 5A 3B, 4B, 5B *6 Indicate how cost of goods manufactured is determined 15, 16, 17, 18 8, 10, 11 8, 9, 10, 11, 12, 13, 14, 15, 16, 17 3A, 4A, 5A 3B, 4B, 5B *7 Explain the difference between a merchandising and a manufacturing balance sheet 10, 19 14, 15, 16, 17 3A, 4A 3B, 4B *8 Identify trends in managerial accounting 20, 21, 22 23, 24 *9 Prepare a work sheet and closing entries for a manufacturing company 25, 26, 27 18 12 19 6A *Note: All asterisked Questions, Exercises, and Problems relate to material contained in the appendix to the chapter 1-1 ASSIGNMENT CHARACTERISTICS TABLE Problem Number Description Difficulty Level Time Allotted (min.) 1A Classify manufacturing costs into different categories and compute the unit cost Simple 20–30 2A Classify manufacturing costs into different categories and compute the unit cost Simple 20–30 3A Indicate the missing amount of different cost items, and prepare a condensed cost of goods manufactured schedule, an income statement, and a partial balance sheet Moderate 30–40 4A Prepare a cost of goods manufactured schedule, a partial income statement, and a partial balance sheet Moderate 30–40 5A Prepare a cost of goods manufactured schedule and a correct income statement Moderate 30–40 1B Classify manufacturing costs into different categories and compute the unit cost Simple 20–30 2B Classify manufacturing costs into different categories and compute the unit cost Simple 20–30 3B Indicate the missing amount of different cost items, and prepare a condensed cost of goods manufactured schedule, an income statement, and a partial balance sheet Moderate 30–40 4B Prepare a cost of goods manufactured schedule, a partial income statement, and a partial balance sheet Moderate 30–40 5B Prepare a cost of goods manufactured schedule and a correct income statement Moderate 30–40 *6A Complete a worksheet; prepare a cost of goods manufactured schedule; an income statement, and a balance sheet; journalize and post the closing entries Complex 40–50 1-2 1-3 Broadening Your Perspective *9 Prepare a work sheet and closing entries for a manufacturing company Q1-26 Q1-23 Q1-24 E1-18 E1-19 P1-6A BE1-9 E1-14 E1-16 Q1-15 Q1-16 Q1-17 Q1-18 BE1-8 BE1-10 E1-8 E1-12 E1-13 E1-4 E1-5 E1-7 BE1-7 E1-4 E1-2 E1-5 E1-3 E1-6 Q1-8 BE1-2 BE1-3 Real-World Focus Q1-25 Q1-27 BE1-12 Q1-20 Q1-21 Q1-22 * Identify trends in managerial accounting E1-15 * Indicate how cost of goods manufactured is determined Q1-10 E1-15 Q1-9 Q1-14 E1-15 * Explain the difference between a merchandising and a manufacturing income statement * Explain the difference between a Q1-19 merchandising and a manufacturing balance sheet Q1-13 BE1-6 E1-3 * Distinguish between product and period costs Q1-12 BE1-4 BE1-5 * Define the three classes of manufacturing costs Q1-11 Q1-4 Q1-5 Q1-6 Q1-7 * Identify the three broad functions of management BE1-1 E1-1 Comprehension Q1-1 Q1-2 Q1-3 Knowledge * Explain the distinguishing features of managerial accounting Study Objective BE1-11 E1-8 E1-9 E1-10 E1-11 E1-12 E1-14 E1-17 P1-4A E1-13 P1-1A P1-2A P1-1A P1-2A P1-1B Application P1-5B E1-8 E1-10 E1-11 P1-3A P1-5A P1-3B Decision Making Across the Organization Communication Managerial Analysis Exploring the Web E1-17 P1-3A P1-4A P1-3B P1-4B E1-13 E1-14 E1-16 E1-17 P1-4A P1-4B P1-5B P1-4B P1-3A P1-5A P1-3B P1-1B P1-2B P1-2B Analysis Ethics Case All About You Synthesis Evaluation Correlation Chart between Bloom’s Taxonomy, Study Objectives and End-of-Chapter Exercises and Problems BLOOM’S TAXONOMY TABLE STUDY OBJECTIVES EXPLAIN THE DISTINGUISHING FEATURES OF MANAGERIAL ACCOUNTING IDENTIFY THE THREE BROAD FUNCTIONS OF MANAGEMENT DEFINE THE THREE CLASSES OF MANUFACTURING COSTS DISTINGUISH BETWEEN PRODUCT AND PERIOD COSTS EXPLAIN THE DIFFERENCE BETWEEN A MERCHANDISING AND A MANUFACTURING INCOME STATEMENT INDICATE HOW COST OF GOODS MANUFACTURED IS DETERMINED EXPLAIN THE DIFFERENCE BETWEEN A MERCHANDISING AND A MANUFACTURING BALANCE SHEET IDENTIFY TRENDS IN MANAGERIAL ACCOUNTING 1-4 CHAPTER REVIEW Managerial Accounting Basics (S.O 1) Managerial accounting is a field of accounting that provides economic and financial information for managers and other internal users Managerial accounting applies to all types of businesses—service, merchandising, and manufacturing—and to all forms of business organizations—proprietorships, partnerships and corporations Moreover, managerial accounting is needed in not-for-profit entities as well as in profit-oriented enterprises Comparing Managerial and Financial Accounting There are both similarities and differences between managerial and financial accounting a Both fields of accounting deal with the economic events of a business and require that the results of that company’s economic events be quantified and communicated to interested parties b The principal differences are the (1) primary users of reports, (2) types and frequency of reports, (3) purpose of reports, (4) content of reports, and (5) verification process The role of the managerial accountant has changed in recent years Whereas in the past their primary concern used to be collecting and reporting costs to management, today they also evaluate how well the company is using its resources and providing information to crossfunctional teams comprised of personnel from production, operations, marketing, engineering, and quality control Management Functions (S.O 2) Managers perform three broad functions within an organization: a Planning requires managers to look ahead and to establish objectives b Directing involves coordinating a company’s diverse activities and human resources to produce a smooth-running operation c Controlling is the process of keeping the firm’s activities on track Organizational Structure In order to assist in carrying out management functions, most companies prepare organization charts to show the interrelationships of activities and the delegation of authority and responsibility with the company Stockholders own the corporation but manage the company through a board of directors The chief executive officer (CEO) has overall responsibility for managing the business The chief financial officer (CFO) is responsible for all of the accounting and finance issues the company faces The CFO is supported by the controller and the treasurer Business Ethics All employees are expected to act ethically in their business activities and an increasing number of organizations provide their employees with a code of business ethics Due to many fraudulent activities in recent years, U.S Congress passed the Sarbanes-Oxley Act of 2002 which resulted in many implications for managers and accountants CEOs and CFOs must certify the fairness of financial statements, top management must certify they maintain an adequate system of internal controls, and other matters 1-5 Manufacturing Costs (S.O 3) Manufacturing consists of activities and processes that convert raw materials into finished goods Manufacturing costs are typically classified as either (a) direct materials, (b) direct labor or (c) manufacturing overhead 10 Direct materials are raw materials that can be physically and conveniently associated with the finished product during the manufacturing process Indirect materials are materials that (a) not physically become a part of the finished product or (b) cannot be traced because their physical association with the finished product is too small in terms of cost Indirect materials are accounted for as part of manufacturing overhead 11 The work of factory employees that can be physically and conveniently associated with converting raw materials into finished goods is considered direct labor In contrast, the wages of maintenance people, timekeepers, and supervisors are usually identified as indirect labor because their efforts have no physical association with the finished product, or it is impractical to trace the costs to the goods produced Indirect labor is classified as manufacturing overhead 12 Manufacturing overhead consists of costs that are indirectly associated with the manufacture of the finished product Manufacturing overhead includes items such as indirect materials, indirect labor, depreciation on factory buildings and machines, and insurance, taxes, and maintenance on factory facilities Product Versus Period Costs 13 (S.O 4) Product costs are costs that are a necessary and integral part of producing the finished product Period costs are costs that are matched with the revenue of a specific time period rather than included as part of the cost of a salable product These are nonmanufacturing costs Period costs include selling and administrative expenses Manufacturing Income Statement 14 (S.O 5) The income statements of a merchandising company and a manufacturing company differ in the cost of goods sold section 15 The cost of goods sold section of the income statement for a manufacturing company shows: Beginning Finished Goods Inventory + Cost of Goods Manufactured – Ending Finished Goods Inventory = Cost of Goods Sold Determining Cost of Goods Manufactured 16 (S.O 6) The determination of the cost of goods manufactured consists of the following: a b Beginning Work in Process Inventory Total Cost of Work in Process + Total Current Manufacturing Costs = Ending – Work in Process = Inventory 1-6 Total Cost of Work in Process Cost of Goods Manufactured 17 The costs assigned to the beginning work in process inventory are the manufacturing costs incurred in the prior period 18 Total manufacturing costs is the sum of the direct materials costs, direct labor costs, and manufacturing overhead incurred in the current period 19 Because a number of accounts are involved, the determination of costs of goods manufactured is presented in a Cost of Goods Manufactured Schedule The cost of goods manufactured schedule shows each of the cost factors above The format for the schedule is: Beginning work in process Direct materials used Direct labor Manufacturing overhead Total manufacturing costs Total cost of work in process Less: Ending work in process Cost of goods manufactured $XXXX $XXXX XXXX XXXX XXXX XXXX XXXX $XXXX Manufacturing Balance Sheet 20 (S.O 7) The balance sheet for a manufacturing company may have three inventory accounts: finished goods inventory, work in process inventory, and raw materials inventory 21 The manufacturing inventories are reported in the current asset section of the balance sheet a The inventories are generally listed in the order of their expected realization in cash b Thus, finished goods inventory is listed first 22 Each step in the accounting cycle for a merchandising company is applicable to a manufacturing company a For example, prior to preparing financial statements, adjusting entries are required b Adjusting entries are essentially the same as those of a merchandising company c The closing entries for a manufacturing company are also similar to those of a merchandising company Contemporary Developments 23 (S.O 8) Contemporary developments in managerial accounting involve: (a) a U.S economy that has in general shifted toward an emphasis on providing services, rather than goods; and (b) efforts to manage the value chain and supply chain 24 Many companies have significantly lowered inventory levels and costs using just-in-time (JIT) inventory methods Under a just-in-time method, goods are manufactured or purchased just in time for use In addition, many companies have installed total quality management (TQM) systems to reduce defects in finished products 25 Activity-based costing (ABC) is a popular method for allocating overhead that obtains more accurate product costs The theory of constraints is a specific approach used to identify and manage constraints in order to achieve the company goals The balanced scorecard is a performance-measurement approach that uses both financial and nonfinancial measures to evaluate all aspects of a company’s operations in an integrated fashion 1-7 *Worksheet *26 (S.O 9) When a worksheet is used in preparing financial statements, two additional columns are needed for the cost of goods manufactured schedule a The columns are labeled Cost of Goods Manufactured b The columns are inserted before the income statement columns *27 In the cost of goods manufactured columns, a The beginning inventories of raw materials and work in process and all manufacturing costs are entered as debits b The ending inventories of raw materials and work in process are entered as credits c The balancing amount for these columns is the cost of goods manufactured and is entered as a credit The same amount is also entered in the income statement debit columns *28 The income statement and balance sheet columns are basically the same as for a merchandising company a Beginning finished goods inventory is entered in the income statement debit column b Ending finished goods inventory is entered in the income statement credit column and the balance sheet debit column *29 In preparing closing entries, a Manufacturing Summary account is used to close all accounts that appear in the cost of goods manufactured schedule a Ending inventories of raw materials and work in process are debited and Manufacturing Summary is credited b Beginning inventories of raw materials and work in process and all manufacturing cost accounts are credited and Manufacturing Summary is debited c The balance in Manufacturing Summary is closed by debiting Income Summary and crediting Manufacturing Summary *30 As in the case of a merchandise company, all accounts shown in the income statement for a manufacturing company are closed to Income Summary 1-8 LECTURE OUTLINE A Managerial Accounting Basics Managerial accounting, also called management accounting, is a field of accounting that provides economic and financial information for managers and other internal users Managerial accounting applies to all types of businesses: service, merchandising, and manufacturing It also applies to all forms of business organizations: proprietorships, partnerships, and corporations B Comparing Managerial and Financial Accounting TEACHING TIP ILLUSTRATION 1-1 presents comparative differences between financial and managerial accounting The distinguishing features of managerial accounting are: a Primary users of reports—internal users: officers and managers b Types and frequency of reports—internal reports issued as frequently as needed c Purpose of reports: special-purpose information for a specific decision d Content of reports—pertains to subunits of the business and may be very detailed; extends beyond double-entry accounting system to any relevant data; the reporting standard is relevance to the decision being made e Verification process—no independent audits 1-9 C Management Functions Manager’s activities and responsibilities can be classified into three broad functions: TEACHING TIP ILLUSTRATION 1-2 depicts the major functions performed by managers Emphasize that managers make decisions in carrying out these functions and need managerial accounting information as input into their decision making-process D a Planning requires managers to look ahead and to establish objectives b Directing involves coordinating a company’s diverse activities and human resources to produce a smooth-running operation c Controlling is the process of keeping the company’s activities on track Organizational Structure Most companies prepare organization charts to show the interrelationships of activities and the delegation of authority and responsibility within the company Stockholders own the corporation, but they manage it indirectly through a board of directors they elect The chief executive officer (CEO) has overall responsibility for managing the business, but delegates responsibility to other officers Responsibilities within a company are classified as either: line positions— employees directly involved in the company’s primary revenue-generating operating activities, or staff positions—employees involved in activities that support line employees’ efforts 1-10 Manufacturing costs are classified as (1) direct materials, (2) direct labor, or (3) manufacturing overhead Direct materials are raw materials that can be physically and directly associated with the finished product during the manufacturing process a Indirect materials: (1) Do not physically become part of the finished product or, (2) Cannot be traced because their physical association with the finished product is too small in terms of cost (i.e lock washers) b Companies account for indirect materials as part of manufacturing overhead Direct labor is the work of factory employees that can be physically and directly associated with converting raw materials into finished goods a Indirect labor has no physical association with the finished product, or it is impractical to trace the costs to the goods produced b Companies classify indirect labor as manufacturing overhead Manufacturing overhead consists of costs that are indirectly associated with the manufacture of the finished product a G Manufacturing overhead includes indirect materials, indirect labor, depreciation on factory buildings and machines, and insurance, taxes, and maintenance on factory facilities Product Versus Period Costs Product costs are costs that are a necessary and integral part of producing the finished product Product costs not become expenses until the company sells the finished goods inventory 1-12 Period costs are costs that are matched with the revenue of a specific time period rather than included as part of the cost of a salable product Period costs include selling and administrative expenses and companies deduct them from revenues in the period in which they are incurred H Manufacturing Costs in Financial Statements The principal differences in a manufacturer’s financial statements occur in the cost of goods sold section in the income statement and the current assets section in the balance sheet Manufacturers compute cost of goods sold by adding the beginning finished goods inventory to the cost of goods manufactured and subtracting the ending finished goods inventory TEACHING TIP ILLUSTRATION 1-4 contrasts the cost of goods sold sections on the income statements of a merchandiser and a manufacturer To determine the cost of goods manufactured, companies add the cost of the beginning work in process to the total manufacturing costs for the current year to find the total cost of work in process for the year Companies then subtract the ending work in process from the total cost of work in process to find the cost of goods manufactured TEACHING TIP ILLUSTRATION 1-5 presents a cost of goods manufactured schedule Point out that this schedule must be prepared before the cost of goods sold section on the income statement 1-13 The balance sheet for a manufacturing company may have three inventory accounts: a Finished Goods Inventory, which shows the cost of completed goods on hand b Work in Process Inventory, which shows the cost applicable to units that have been started into production but are only partially completed c Raw Materials Inventory, which shows the cost of raw materials on hand TEACHING TIP Use ILLUSTRATION 1-6 to contrast the inventory accounts of a merchandiser and a manufacturer Emphasize that except for inventories, all other current asset accounts are of the same type for both merchandisers and manufacturers I Managerial Accounting Today Managerial accounting has experienced many changes in recent years including a shift toward addressing the needs of service companies and improving practices to better meet the needs of managers In some instances the managerial accountant may need to develop new systems for measuring the cost of serving individual customers Companies may need new operating controls to improve the quality and efficiency of specific services The value chain refers to all activities associated with providing a product or service (i.e research and development, production, delivery, etc.) Analysis of the value chain has made companies far more responsive to customer needs and has improved profitability 1-14 Many companies now employ enterprise resource planning (ERP) software systems to manage their value chain ERP systems provide a comprehensive, centralized, integrated source of information that companies can use to manage all major business processes, from purchasing to manufacturing to recording human resources Using computer-integrated manufacturing (CIM), many companies can now manufacture products by the use of robotic equipment which significantly reduces direct labor costs in many cases Technology is also affecting the value chain through business-tobusiness (B2B) e-commerce on the Internet Interorganizational information systems connected over the Internet enables suppliers to share information nearly instantaneously and has changed the marketplace, often having the effect of cutting out intermediaries—the “middle man.” Many companies have significantly lowered inventory levels and costs using just-in-time (JIT) inventory methods Under a just-in-time method, goods are manufactured or purchased just in time for use Many companies have installed total quality management (TQM) systems to reduce defects in finished products These systems require timely data on defective products, rework costs, and the cost of honoring warranty contracts In order to obtain more accurate product costs, many companies now allocate overhead using activity-based costing (ABC) Under ABC, companies allocate overhead based on each product’s use of activities in making the product 10 All companies have constraints that limit their potential profitability The theory of constraints is a specific approach used to identify and manage constraints in order to achieve the company goals 11 The balanced scorecard is now used by many companies in order to attain a more comprehensive view of the company’s operations The balance scorecard is a performance-measurement approach that uses both financial and nonfinancial measures to evaluate all aspects of a company’s operations in an integrated fashion 1-15 *J Accounting Cycle for a Manufacturing Company The accounting cycle for a manufacturing company is the same as for a merchandising company when companies use a periodic inventory system Except for the additional manufacturing inventories and manufacturing cost accounts, the journalizing and posting of transactions is the same When a company uses a worksheet in preparing financial statements, it needs two additional columns for the cost of goods manufactured schedule Manufacturing companies use a Manufacturing Summary account to close all accounts that appear in the cost of goods manufactured schedule The balance of the Manufacturing Summary account is the Cost of Goods Manufactured for the period 1-16 20 MINUTE QUIZ Circle the correct answer True/False Managerial accounting is a field of accounting that provides economic information for external users True The primary users of managerial accounting information are external users who are stockholders, creditors, and regulatory agencies True False Cost of goods manufactured for a manufacturing company is the equivalent of cost of goods sold for a merchandising company True 10 False The sum of the direct materials costs, direct labor costs, and manufacturing overhead incurred is the total manufacturing costs for the current period True False Selling and administrative expenses are product costs True False Indirect materials, indirect labor, and maintenance on factory facilities are all included in manufacturing overhead True False Finished Goods Inventory plus Work in Process Inventory constitutes Cost of Goods Available for Sale True False Manufacturing Inventory is one of the three inventory accounts a manufacturing company may have True False The purpose of reports in managerial accounting is to provide special-purpose information for a particular user for a specific decision True False False The finished goods inventory for a manufacturing company is the equivalent of the merchandise inventory for a merchandising company True False 1-17 Multiple Choice Which of the following does not apply to the content of managerial reports? a Reporting standard is relevance to the decision to be made b May extend beyond double-entry accounting system c Pertains to subunits of the entity and may be very detailed d Pertains to the entity as a whole and is highly aggregated Management functions include a planning b directing c controlling d all of the above Which of the following inventory accounts is not applicable to a manufacturing company? a Finished Goods Inventory b Merchandise Inventory c Raw Materials Inventory d Work in Process Inventory If direct materials for one unit of product are $9.00, direct labor for one hour is $15.00, manufacturing overhead costs are $5.00 per direct labor hour, and one-fourth hour of direct labor is required to produce one unit of product, how much are the conversion costs for one unit of product? a $5.00 b $2.50 c $20.00 d $15.00 Direct materials and direct labor are a period costs b product costs c overhead costs d indirect costs 1-18 ANSWERS TO QUIZ True/False False False True False False 10 True False True False True Multiple Choice d d b a b 1-19 ILLUSTRATION 1-1 DIFFERENCES BETWEEN FINANCIAL AND MANAGERIAL ACCOUNTING Financial Accounting External users: stockholders, creditors, and regulators Financial statements Issued quarterly and annually An Re nual po rt Managerial Accounting Primary Users of Reports Types and Frequency of Reports Internal users: officers and managers Internal reports Issued as frequently as needed General-purpose Purpose of Reports Special-purpose for specific decisions Pertains to business as a whole and is highly aggregated (condensed) Limited to double-entry accounting and cost data Standard is generally accepted accounting principles Content of Reports Pertains to subunits of the business and may be very detailed Extends beyond double-entry accounting to any relevant data Annual independent audit by certified public accountant Verification Process Standard is relevance to decisions 1-20 No independent audits Manager ILLUSTRATION 1-2 MANAGEMENT FUNCTIONS PLANNING — Establishing objectives DIRECTING — Coordinating a company’s diverse activities and human resources to produce a smooth-running operation CONTROLLING — Process of keeping the firm’s activities on track by determining whether planned goals are being met and what changes are needed to get back on track 1-21 1-22 Manufacturing Overhead Direct Labor Direct Materials Product Costs Manufacturing Costs All Costs Administrative Expenses Selling Expenses Period Costs Nonmanufacturing Costs ILLUSTRATION 1-3 PRODUCT VERSUS PERIOD COSTS ILLUSTRATION 1-4 COST OF GOODS SOLD SECTIONS— MERCHANDISER VS MANUFACTURER Merchandiser Company Income Statement For the Year Ended December 31, 2008 Manufacturer Company Income Statement For the Year Ended December 31, 2008 Cost of goods sold Cost of goods sold Merchandise inventory, $210,000 January Cost of goods purchased 500,000 Finished goods inventory, $125,000 January Cost of goods manufac400,000 tured (see schedule) Cost of goods available for sale Cost of goods available for sale Merchandise inventory, December 31 Cost of goods sold 710,000 250,000 $460,000 1-23 525,000 Finished goods inventory, 115,000 December 31 Cost of goods sold $410,000 ILLUSTRATION 1-5 COST OF GOODS MANUFACTURED SCHEDULE MANUFACTURER COMPANY Cost of Goods Manufactured Schedule For the Year Ended December 31, 2008 Work in process, January Direct materials Raw materials inventory, January Raw materials purchases Total raw materials available for use Less: Raw materials inventory December 31 Direct materials used Direct labor Manufacturing overhead Indirect labor Factory repairs Factory utilities Factory depreciation Factory insurance Total manufacturing overhead Total manufacturing costs Total cost of work in process Less: Work in process, December 31 Cost of goods manufactured 1-24 $ 24,200 $ 17,500 168,400 185,900 23,900 $162,000 181,000 15,300 13,400 11,600 10,700 8,500 59,500 402,500 426,700 26,700 $400,000 ILLUSTRATION 1-6 CURRENT ASSETS SECTIONS— MERCHANDISER VS MANUFACTURER Merchandiser Company Current Assets Section December 31, 2008 Current assets Cash Manufacturer Company Current Assets Section December 31, 2008 Current assets $ 24,600 Cash 76,300 Receivables (net) Merchandise inventory 250,000 Inventories: 1,100 Finished goods Prepaid expenses $115,000 $352,000 Work in process 26,700 Total current assets 23,900 Raw materials Receivables (net) Prepaid expenses Total current assets 1-25 $ 28,400 82,000 165,600 1,500 $277,500 ... MANUFACTURING BALANCE SHEET IDENTIFY TRENDS IN MANAGERIAL ACCOUNTING 1-4 CHAPTER REVIEW Managerial Accounting Basics (S.O 1) Managerial accounting is a field of accounting that provides economic and financial... closed to Income Summary 1-8 LECTURE OUTLINE A Managerial Accounting Basics Managerial accounting, also called management accounting, is a field of accounting that provides economic and financial... Comparing Managerial and Financial Accounting TEACHING TIP ILLUSTRATION 1-1 presents comparative differences between financial and managerial accounting The distinguishing features of managerial accounting