Question

The principal difference between management accounting and financial accounting is that financial accounting information is:

A) Prepared by managers.
B) Intended primarily for use by decision makers outside the business organization.
C) Prepared in accordance with a set of accounting principles developed by the Institute of Certified Management Accountants.
D) Oriented toward measuring solvency rather than profitability.

Answer 1

The principal difference between management accounting and financial accounting is that financial accounting information is intended primarily for use by decision makers outside the business organization.

Step-by-step explanation:

The principal difference between management accounting and financial accounting is that financial accounting information is intended primarily for use by decision makers outside the business organization, while management accounting information is prepared and used by managers within the organization to make internal decisions.

Financial accounting focuses on providing accurate and reliable information to stakeholders such as investors, creditors, and regulatory authorities to assess a company's financial performance and position.