Which of the following types of accounting is primarily concerned with providing information to internal management for decision-making purposes?

• A. Governmental accounting
• B. Tax accounting
• C. Financial accounting
• D. Managerial accounting

Answer: (D)

Verified step by step guidance

1. Understand the purpose of each type of accounting mentioned in the problem. Governmental accounting focuses on the financial activities of government entities, tax accounting deals with compliance with tax laws, and financial accounting provides information to external stakeholders such as investors and creditors.
2. Recognize that the question is asking about the type of accounting that provides information specifically to internal management for decision-making purposes.
3. Learn the definition of managerial accounting: Managerial accounting is a branch of accounting that focuses on providing financial and non-financial information to internal management to assist in planning, controlling, and decision-making processes.
4. Compare the characteristics of managerial accounting with the other types of accounting listed in the problem. Managerial accounting is distinct because it is tailored to the needs of internal users rather than external stakeholders.
5. Conclude that the correct answer is managerial accounting, as it aligns with the requirement of providing information to internal management for decision-making purposes.