Question

Which of the following statements is true?

1) Managerial accounting standards are established by the federal government.
2) Managerial accounting data are prepared for external users.
3) Managerial accounting reports are less regulated than financial accounting reports.
4) Managerial accounting is characterized by its objectivity, reliability, consistency and historical nature.

Answer 1

Managerial accounting reports are less regulated than financial accounting reports, tailored for internal business decisions, and not governed by federal mandates.Answer is option c

Step-by-step explanation:

The correct statement about managerial accounting is that managerial accounting reports are less regulated than financial accounting reports. Managerial accounting is not governed by federal regulations but is designed to meet the internal needs of a business's management. Financial accounting regulations, such as those established by the Financial Accounting Standards Board (FASB) or the International Financial Reporting Standards (IFRS), do not apply.

While financial accounting is prepared for external stakeholders and must conform to these standards, managerial accounting information is tailored for internal decision-making purposes, and therefore, it can be more flexible to meet the company’s specific needs. Additionally, managerial accounting is characterized by its relevance and timeliness rather than its historical nature, which is more central to financial accounting.