The Magic Words--'Managerial Accounting'

Abstract This article focuses on the managerial accounting. Many textbooks which make some claim to the managerial approach are organized in much the same way as they have been for the past twenty years. The bookkeeping cycle and type of bookkeeping records are described in detail, the variations in the particular techniques applicable to different types of business situations are considered, and valuation and classification of different items for statement purposes are given considerable emphasis. The managerial aspects of the test are limited to some description of the use of ratios and comparative statements. Having attempted to describe managerial accounting and to indicate how it might be employed, the authors would like to offer some defense of accounting instruction as it has existed. Accounting instruction has been condemned in high circles because of its emphasis on techniques. The managerial approach, although described in rather vague terms, is offered as the innovation to cure the ills of accounting instruction. Certainly it can not be denied that frequently techniques have been over emphasized. Despite this over emphasis, however, the accounting profession has attained a position of importance in business, a stature that every one recognizes.