Correct Answer:
B
The primary purpose of accumulating and reporting cost information—especially in government and
nonprofit environments—is to support internal decision-making. Cost data help managers assess
program efficiency, evaluate resource use, and make policy or operational decisions.
While external financial statements may incorporate summarized cost information, and stockholders
and regulatory agencies may have interests in private-sector settings, the most direct and core
purpose is to support management.
Relevant Reference:
FASAB SFFAS No. 4 – Managerial Cost Accounting Concepts and Standards
GFOA – Cost Accounting for Decision-Making
OMB Circular A-136 and A-11 (federal reporting objectives)
Answer : B. provide a means for management to assess decision performance
