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Explain the similarities and differences between financial and managerial accounting, and prepare, use and interpret a contribution...

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Accounting

Explain the similarities and differences between financial andmanagerial accounting, and prepare, use and interpret acontribution margin income statement using cost, volume, profit andbreak-even techniques.

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Similarities between financial and managerial planning 1 Both are the parts of total accounting information system 2 Economic events are dealt in the both system of accounts 3 The economic events are qualified only in terms of rupees 4 Both are concerned with financial statements revenues expenses assets liabilities and cash flows 5 Both the system of accounts are accumulating and classifying the accounting information for the preparation of financial statements 6 Some database is used for preparing financial statements and reports under both system of accounts 7 Both are determining and measurement of costs for different accounting periods and even for different departments and sections 8 The same accounting principles and concepts are used in both system of accounts for the purpose of cost accumulation and cost allocation Difference between financial and managerial planning Aggregation Financial accounting reports on the results of an entire business Managerial accounting almost always reports at a more detailed level such as profits by product product line customer and geographic region Efficiency Financial accounting reports on the profitability and therefore the efficiency of a business whereas managerial accounting reports on specifically what is causing problems and    See Answer
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