Answer to classmates with 1-2 paragraphs
Everett
In this week’s discussion, we are asked to point out some of the differences between managerial accounting and financial accounting. Our text defines managerial accounting as the process of identifying, measuring, analyzing, interpreting, and communicating information in pursuit of an organizations goals, (Hilton & Platt, 2020). Essentially meaning running a business. Comparatively, financial accounting is the preparation of documents and statements to accurately describe and show the position of a company. To provide further context, its important to understand that the description of a position may influence investors, provide context to higher-level headquarters, or show your bosses how much better your store is doing than other ones. However, that is all still summarized in financial accounting, the on-ground decision-making process still resides with the managerial accounting, looking at the profits made to determine the appropriate wine to buy for the restaurant, or being able to argue against an initiative that the corporate management team is pushing are all very important as well.
The next section of the discussion asks us to give examples of each of the four primary management activities in the context of a national fast-food chain such as Chipotle. Being that this is one of my favorite restaurants, I was psyched to read this and apply those four main activities to the problem. The first one that comes to mind, after having worked in the restaurant industry through college is that the planning of deliveries is incredibly important. That falls into the category of directing operational activity, without on-time deliveries or knowing the stock that remains and the expiration dates as applicable to different items, the restaurant as a whole will suffer. Planning in a broader sense is necessary for opening new facilities and corporate expansion, however, one thing Chipotle lacks is the need to plan new dishes. Theyve been doing the same items for 10 years now, with no change and it works. The predominance of the planning that occurs may be entirely focused above the single restaurant view. Third, decision making might also occur above the single restaurant view, unless they are non corporately owned of course. The decision for supplying baskets, trays, furniture, and other basic items is all contract out to the lowest bidder, whereas a noncorporate restaurant may need to make decisions based on small item pricing, corporations can afford to buy in bulk and distribute the goods across all stores. Finally, controlling also occurs at a corporate level. Individual restaurants’ responsibility is to roll out any policies the corporate head shed makes known, whereas in a smaller noncorporate business the controlling of health care plans, retirement, and basic day to day operations are all controlled at a much lower level.
References
Hilton, R. W., & Platt, D. E. (2020). Managerial Accounting Creating Value in a Dynamic Business Environment (12th ed.). New York, United States: Mcgraw Hill.
Andrea
Managerial accounting is different from financial accounting because managerial accounting focuses on the business. Managerial accounting is more of an internal. Managerial accountants are there to make decisions based on being an “analyst” and solving problems (Hilton & Platt, 2017). Financial accounting is reporting accounting information to organizations outside the business. Financial accounting is also regulated. Financial accounting focuses on the entire business whereas, managerial focuses on departments within the business.
Give examples of each of the four primary management activities in the context of a national fast-food chain such as Chipotle (Carullo, 2016):
Decision Making- Chipotle goal is to uphold healthier food choices. The idea is to promote “all natural” food. Using certain farming and eventually attempting to convert to local. The idea is for healthy eating.
Planning- Chipotle has plans to continue to create jobs. The business will also be adding more benefits to make the jobs more desirable. The idea is to grow the workforce to meet the demands for the business.
Directing operational activities- Chipotle focuses on hiring the right people for the right jobs. Ensuring employees are paid properly and have the proper tools to be successful. Chipotle wants to maintain the integrity of the business by keeping their goals and promises to the public.
There is a strong preference for customers and employees to interact with humans. Quality Assurance is of great importance. Programs are important for employees to have social mobility.
Controlling- Evaluating Chipotle. Are the plans working? What can be done to improve plans if they are not?
Carullo, A. (2016, May 2). Chipotle–An Analysis of the Growth and Future of the Fast-Casual Din… SlideShare. .
Hilton, R. W. (2011). Managerial accounting. McGraw-Hill Higher Education.
