Cost accounting is that section of accounting which strives at generating data to manage operations with a view to maximizing profits and performance of the company, it is also termed control accounting. On the contrary, management accounting is that type of accounting which support management in planning and decision-making and hence known as decision accounting.
What is Cost Accounting?
Cost accounting is an accounting system that aspires to capture an enterprise’s costs of manufacturing by evaluating the input costs of each step of manufacturing as well as fixed costs, namely, depreciation of capital equipment. Cost accounting will initially compute and document these costs separately, then analyse input outcomes to output or actual outcomes to assist the enterprise’s management in computing financial accomplishment.
What is Management Accounting?
Management Accounting refers to the outlining of financial and non-financial data for the utilisation of management of the enterprise. It is also known as managerial accounting. The data furnished is useful in outlining budgeting, forecasting plans, policies and strategies, evaluating the performance and making comparisons of the management.
Related link: Difference Between Cost Accounting and Financial Accounting
This article is a ready reckoner guide for all the students to learn the Difference between Cost Accounting and Management Accounting :
|Basis||Cost Accounting||Management Accounting|
|Meaning||Cost accounting is an accounting system that aspires to capture an enterprise’s costs of manufacturing by evaluating the input costs of every step of manufacturing as well as the fixed costs, namely, depreciation of capital equipment.||Management Accounting refers to the outlining of financial and non-financial data for the utilisation of management of the enterprise. It is also known as managerial accounting.|
|Data type||Quantitative||Both Quantitative and Qualitative|
|Scope||Focused on distribution, allocation, determination and accounting factors of the cost||Convey (impart) and effect factor of the cost|
|Objective||Determined in cost production||Furnishing data to the managers to fix goals and anticipate strategies|
|Planning||Short term planning||Both Short and long term planning|
|Recording||Records both past and present data||Focuses more on scrutinizing for future projects|
|Interdependency||Can be installed without a Management accounting||Cannot be installed without cost accounting|
The above mentioned is the concept, that is elucidated in detail about ‘Difference between Cost Accounting and Management Accounting’ for the Commerce students. To know more, stay tuned to BYJU’S.