Question

Which of the following are characteristics of managerial accounting information?

1) Provides information to the company's management team.
2) Is future oriented.
3) Is more willing to sacrifice reliability to gain relevance than is financial accounting.
4) All of the answers describe characteristics of managerial accounting information.

Answer 1

The characteristics of managerial accounting information include providing information to the management team, being future-oriented, and valuing relevance over reliability to a greater extent than financial accounting. All responses given are correct, making option 4 the right answer.

Step-by-step explanation:

The question asks which characteristics describe managerial accounting information. This type of accounting is focused on providing tailored information to the company's management to assist with decision-making. When we analyze the options provided:

1. Provides information to the company's management team.
2. Is future oriented.
3. Is more willing to sacrifice reliability to gain relevance than is financial accounting.
4. All of the answers describe characteristics of managerial accounting information.

All three statements are indeed characteristics of managerial accounting. The first characteristic highlights its internal focus. The second points out its emphasis on forecasting and planning. The third distinguishes managerial accounting from financial accounting, noting the preference for relevant information that can be used to make decisions, even if it's less concrete. Therefore, the correct option in the final answer is:

4) All of the answers describe characteristics of managerial accounting information.