Question

What three guidelines help management accountants provide the most value to​ managers?

A.

​(1) Understand the organization​ structure, (2) Employ a​ cost-benefit approach, and​ (3) Maintain integrity and credibility in every aspect of the job

B.

​(1) Decision-making,​ (2) Planning, and​ (3) Control

C.

​(1) Employ a​ cost-benefit approach,​ (2) Recognize behavioural and technical​ considerations, and​ (3) Identifying relevance and that decisions require​ "different costs for different​ purposes"

D.

​(1) Planning,​ (2) Control, and​ (3) Performance evaluation and learning

Answer 1

C.

​(1) Employ a​ cost-benefit approach,​ (2) Recognize behavioural and technical​ considerations, and​ (3) Identifying relevance and that decisions require​ "different costs for different​ purposes"

Explanation:

Managers should spend on certain resources only if the expected benefits exceed the costs. The managers often rely on the management accounting information to obatin these costs and benefits.

Technical considerations help managers make wise economic decisions by providing desired information in an appropriate format and at the preferred frequency.

Managers use alternative ways to compute costs in different decision-making situations because there are different costs for different purposes. A cost concept used for the purposes of external reporting may not be appropriate for internal, routine reporting and vice versa.