cost accounting is application of costing and cost
accounting principles, methods and technique to the
science, art and practise of cost control
financial accounting is for the financial transaction of a
business. income statement, balance sheet preparing p&l a/c
cost accounting is for internal use while financial
accounting is both internal and externaluse.the purpose of
cost accounting is to ascertain the cost of a product hence
it provides management with information as to what
percentage markup should be placed in order to realize
profits. it also helps management with ways of lowering
total costs hence cost accounting is mainly for internal
use.it provides management with decision as to buy or make
and the worthiness of undertaking a project
financial accounting is for both internal and external it is
also used by management to evaluate performance through the
statement of comprehensive income and through interpretation
using ratios also evaluate the rate into which profits are
turned into cash through the statement of cash flows and
also evaluating the leverage of the company but the
financial accounting is mainly for externals that is for
stakeholders : shareholders ,creditors ,security providers
that is why they are published.
the other difference is that financial accounting is a
statutory requirement and is prepared in compliance with
international accounting standards and IFRS while cost
accounting is not a statutory requirement but its a company
requirement
Cost accounting is a branch of financial account.but now
its as a profession of own rights.Cost accounting is
systmatic recording the transaction. finacial accounting
providing profit and loss account and balance sheet to
present the management. But Modern management needs much
more details. So, cost accounting provided detailed
information to management of separate department ,
product , etc.
Mainly finacial account supplied statement of Profit &
loss account and balance sheet for outsiders.
And Cost accounting supplied statment of cost of product and
departmnet.
Financial Accounting is to find out the profitability if
operations during a particular period for the benefit of
owners and outsiders.
Cost accounting is to help management through the provision
of prompt cost data and thereby improve managerial decision
making.
In simple Financial Accouting shows the Overall profit of
the organisation. Cost Accounting shows individually ie.,
product wise.
cost accounting is a management information system that
analyse the past,present and future data to provide a basis
for management decision.
it is the internal decision, makes by the management.
and the financial accounting is an external decision, makes
by the management.
One of the basic differences Cost Accounting is helpfully
in controlling the cost of production whereas Financial
Accounting is concerned is helpfully in determining
financial position of a concern .
Cost Accounting helps in finding out cost of a product and
control of cost.whereas Financial Accounting helps in
knowing the financial position of the business i.e is
profit or loss in a financial year.
Cost accounting deals primarily in allocation and
controlling of cost of labor, materials and overhead in the
production of a product. The results is used in the
determination of cost of goods sold and profit margin from
sales. Financial aacounting is concerned with analyzing,
summarizing, recording and reporting of all financial
activities of a business in the P & L and statement of
financial position based on company's established policy
and procedures, generally accepted accounting principles
and or IFRS.
Financial Accounting provides information about the business in
general way.It tells about the profit and loss snd financial
position of the bussiness to the owner and other out side
parties.But cost accounting provides information to the
management for propper planning,operation,congrol,and
decision making.GIVEN BY M.IBRAHIM--MIBWA
cost accounting is the applicatin of accounting and costing
principles methods and techniques in the
ascertainment,classification,recording,allocating,summarisin
g,and presenting of costing information and the analysis of
savings and or excesses as compared with previous
experience or predetermined standards
on the other hand financial accounting is concerned wih the
stewardship obligation of management in relationship to the
external requirements of shareholders,creditors,prospective
investors and other interested parties outside the
organisation as well as internal management requirements
Suppose you buy a one-year government bond that has a
maturity value of Rs.1000. The market interest rate is 8
per cent. (a) How much will you pay for the bond? (b) If
you purchase the bond for Rs.904.98, what interest rate
will you earn from this investment
Hi, I did MBA Finance in 2007 but i am from science back
ground. And for the past 3 yrs i worked as im Admin and as
a IT recruiter. Could any tell me what are the questions
generally asked for MBA Finance position? i am looking to
pursue a career in Finance
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