QUESTIONS

QUESTIONS
1. What are the three broad purposes of an accounting system?

a) Internal report to managers, for use in planning and control routine
operations
b) Internal report to managers, for use in making non routine decision
and in formulating major plans and policies
c) External report to stockholders, government and other parties
2. “The emphases of financial accounting and management accounting
differ”. Explain briefly.
Because as we say financial accounting, it concerns about making
reports for external parties, wherein it engages historical, custodial,
stewardship aspect of accounting. While management accounting, is mainly
focused on internal aspect of the organization which is the planning and
control of business.
3. Give examples of special nonrecurring decisions and long-range
planning.
 Launching new product line
 Changes in org structure
 Policies
4. “Planning is much more vital than control”. Do you agree explain.
No, because as sir manos said in the previous meeting, both are
considered the main management functions. Though planning function is
where the business starts, is where the preparation and setting of objectives
and procedure takes place, but as the same time, control has also important
role wherein planning can’t specially that as we say control it limits and
manages the resources available as well the smooth flow of operations by
feedbacks.
5. “Management by exception means abdicating management responsibility
for planning and control”. Do you agree? Explain
No, because when we say management by exception, it is when
managers gets involve only when there is an activity that falls outside the
range of acceptable manner , and still I see this more about control and at
the same time planning inserts here. Because managers need to have
discussion or plan as how to address the said issue and align the activity as
to its usual or normal manner intended.
6. Distinguish between line function and staff function.
Line function means those directly responsible for attaining the basic
objectives of the org while staff function pertains to activities done by
departments who are not directly involve in carrying out the basic objectives.
This is supportive in nature in a sense that they provide assistance to those
who are performing line function or other parts of org
7. “The field is less sharply defined. There is heavier use of economic
decisions sciences, and behavioral sciences.” identify the branch of
accounting describe in the quotation.
The branch of accounting describe in the quotation is the management
accouting. Because as we know, in management accounting it concerns on
the internal reports, decisions and operations of the org wherein it includes
the cost, inventory valuation and most importantly the planning and comtrol
function. Under management accounting as well, there is overseeing of
behaviour for better flow of operations and to determine if it is align
according to plans.
8. “The controller does control in a special sense” Explain.
Because controller reports and interpret relevant data and exerts a
force or influence that impels management toward decisions consistent with
objectives since controller are the head of accounting department which
means they have a power and authority.
9. Differentiate cost accounting from financial accounting.
As we say financial accounting, it provides information about the
business as a whole, which means management do control in a general way
the major functions like administration, financing, production and marketing.
And concerns in transaction between business and outside parties. In cost
accounting, it seeks to account the separate performances of various
operating units of business. Primarily deals with internal transactions. It
provides separate information for product processes, the element of cost
and such, thus making them effectively exercise the function of planning and
controlling.
10. Explain the different levels of management.
 Upper level managers/strategic planning level (at the top of the
organizational hierarchy) - board of directors, presiden56and vice
presidents . Their decisions have impact to the entire organizations and
to years to come
 Middle level managers (management control level) - regional managers,
product managers, and division heads. Their responsibility is to put plans
into actions and ensure that goals are met.
 Lower level managers (Operational level) - department heads,
supervisors, and project leaders. Persons responsible for accomplishing
the plans specified by their supervisors. Core information in here is
undertaken.
 Managers on the strategic planning level place greater emphasis on
environmental information and prefer summary format while managers in
operational level regard internal information as vita and prefer detail with
the middle managers.
11. What do you understand by management process?
It involves 5 broad activities carried out by org which are the:
*Planning- development of objectives and setting necessary preparations
*Organizing- determining the activities needed to carry out the plans and
assign these to individuals
*Directing- Overseeing day to day activities to ensue org is functioning
smoothly
*Controlling- instituting procedures and then obtaining feedback as needed
to ensure that org are moving toward the attainment of common goal
*Decision making- making rational choices among alternatives
12. Differentiate planning function from control function
Planning is essentially a decision making process, dealing with objectives
preparations and such while control function deals with management task or
organizing and coordinating human and non human resources in order to
achieve desired results.
13. Differentiate management from accounting
14. Management can be defined either function or process. It is a function as it concerns on
ability to do a job thru others and it is a process as it involves planning, organizing, directing
and controlling of activities. On the other hand, accounting is the process of identifying ,
communicating, and measuring of financial and economic information to facilitate informed
judgement by users of the information. It is the language of business.

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1. What are the three broad purposes of an accounting system?

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