The correct statement about management accounting is: "It involves the preparation of detailed plans and forecasts."

Here's why:

1. Management accounting is not governed by generally accepted accounting principles (GAAP). GAAP applies to financial accounting, which is primarily concerned with producing financial reports for external stakeholders.

2. Management accounting is not primarily concerned with external reporting. Again, this is a characteristic of financial accounting. Management accounting is more focused on providing information for internal use by the company's management.

3. Management accounting does not focus on past performance. While it does consider past performance, its main focus is on future performance. It uses past data to make forecasts and plans for the future.

4. Management accounting does involve the preparation of detailed plans and forecasts. This is one of its main functions. It helps management plan for the future and make decisions based on these plans and forecasts.

Question

The correct statement about management accounting is: "It involves the preparation of detailed plans and forecasts."

Here's why:

1. Management accounting is not governed by generally accepted accounting principles (GAAP). GAAP applies to financial accounting, which is primarily concerned with producing financial reports for external stakeholders.

2. Management accounting is not primarily concerned with external reporting. Again, this is a characteristic of financial accounting. Management accounting is more focused on providing information for internal use by the company's management.

3. Management accounting does not focus on past performance. While it does consider past performance, its main focus is on future performance. It uses past data to make forecasts and plans for the future.

4. Management accounting does involve the preparation of detailed plans and forecasts. This is one of its main functions. It helps management plan for the future and make decisions based on these plans and forecasts.

Knowee AI · Accepted Answer

The correct statement about management accounting is: "It involves the preparation of detailed plans and forecasts."

Here's why:

1. Management accounting is not governed by generally accepted accounting principles (GAAP). GAAP applies to financial accounting, which is primarily concerned with producing financial reports for external stakeholders.

2. Management accounting is not primarily concerned with external reporting. Again, this is a characteristic of financial accounting. Management accounting is more focused on providing information for internal use by the company's management.

3. Management accounting does not focus on past performance. While it does consider past performance, its main focus is on future performance. It uses past data to make forecasts and plans for the future.

4. Management accounting does involve the preparation of detailed plans and forecasts. This is one of its main functions. It helps management plan for the future and make decisions based on these plans and forecasts.

Which of the following statements about management accounting is true?It is governed by generally accepted accounting principles (GAAP).It is primarily concerned with external reporting.It focuses on past performance.It involves the preparation of detailed plans and forecasts.

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