Which of the following differentiates cost accounting and financial accounting?
A) The primary users of cost accounting are the investors, whereas the primary users of financial accounting are the managers.
B) Cost accounting deals with product design, production, and marketing strategies, whereas financial accounting deals mainly with pricing of the products.
C) Cost accounting measures only the financial information related to the costs of acquiring fixed assets in an organization, whereas financial accounting measures financial and nonfinancial information of a company's business transactions.
D) Cost accounting measures information related to the costs of acquiring or using resources in an organization, whereas financial accounting measures a financial position of a company to investors, banks, and external parties.

Question

Quizplus · Accepted Answer

Cost accounting focuses on measuring and analyzing the costs incurred to acquire or use resources within an organization, while financial accounting is concerned with presenting a company's financial position and performance to external parties such as investors, banks, and creditors. Financial accounting measures not only financial but also non-financial information about a company's transactions. Option A is incorrect as financial accounting is more useful for investors rather than managers. Option B is incorrect as pricing is also an important aspect of cost accounting. Option C is incorrect as cost accounting measures more than fixed asset costs.

Which of the Following Differentiates Cost Accounting and Financial Accounting