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Managerial Accounting: Creating Value in a Dynamic Business Environment 11th Edition by Ronald Hilton,David Platt
Edition 11ISBN: 978-1259569562Managerial Accounting: Creating Value in a Dynamic Business Environment 11th Edition by Ronald Hilton,David Platt
Edition 11ISBN: 978-1259569562 Exercise 1
According to some estimates, the volume of electronic commerce transactions exceeds $3 trillion. Businessto- business transactions account for almost half of this amount. What changes do you believe are in store for managerial accounting as a result of the explosion in e-commerce?
Explanation
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The explosion in e-commerce will affect managerial accounting in significant ways; one effect will be a drastic reduction in paper work. Millions of transactions between businesses will be conducted electronically with no hard copy documentation. Along with this method of communicating for business transactions comes the very significant issue of information security.
Businesses need to find ways to protect confidential information in their own computers, while at the same time sharing the information to complete the necessary transaction. Another effect of e-commerce is the dramatically increased speed with which business transactions can be conducted. In addition to these business to business transactional issues, there will dramatic changes in the way managerial accounting procedures are carried out, one example being e-budgeting which is the enterprise wide and electronic completion of a company's budgeting process.
Businesses need to find ways to protect confidential information in their own computers, while at the same time sharing the information to complete the necessary transaction. Another effect of e-commerce is the dramatically increased speed with which business transactions can be conducted. In addition to these business to business transactional issues, there will dramatic changes in the way managerial accounting procedures are carried out, one example being e-budgeting which is the enterprise wide and electronic completion of a company's budgeting process.
Managerial Accounting: Creating Value in a Dynamic Business Environment 11th Edition by Ronald Hilton,David Platt
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