Question

List three examples of non-monetary information that might appear in a managerial accounting report.

Answer 1

Management Accounting refers to the preparation of financial and non-financial information for the use of management of the company. It is also termed as managerial accounting. The information provided by it is helpful in making policies and strategies, budgeting, forecasting future plans, making comparisons and evaluating the performance of the management. The reports produced by management accounting are used by the internal management (managers and employees) of the organization and so they are not reported at the end of the financial year.

Although managerial accounting reports contain financial data, much of the information in these reports is non-monetary, such as:

• the quantity of material consumed in production during a period of time.
• the number of hours worked by employees weekly or daily.
• the number of defective products produced in a lot.

As mentioned in the first paragraph, managerial accounting is done from the point of view of the management, which just for decision-making and analytical purposes and not reporting.