Question

Identify the following characteristics as primarily related to financial accounting​ (FA) or managerial accounting​ (MA):1. Helps creditors make lending decisions. 2. Helps in planning and controlling operations. 3. Is not required to follow GAAP. 4. Has a focus on the future. 5. Summary reports prepared quarterly or annually.

Answer 1

Financial accounting is the aspect of accounting that is concerned with the summary, analysis and reporting of financial transactions related to a business.

While managerial accounting is the aspect of accounting that is concerned with the identification, measurement, analysis, and interpretation of accounting information to help managers plan for the future, make decisions for the company, and determine if their plans and decisions were accurate and efficient.

1. Helps Creditors make lending decisions is related Financial Accounting.

2. Helps in planning and controlling operations is related to Managerial Accounting.

3. Is not required to follow GAAP is related to Managerial Accounting.

4. Has a focus on the future is related to Managerial Accounting.

5. Summary reports prepared quarterly or annually is related to Financial Accounting.