To make these decisions, these managers need to estimate the revenue that Lands' End can expect to earn from selling the goods and how much the goods will cost Lands' End. Clearly, the company want its revenues to exceed its expenses so that the company will earn a profit. Financial accounting helps managers measure the revenue, the expenses, and the profit of the business. Lands' End managers must also determine what kinds of investments to make. If so, they will want to purchase the merchandise-handling equipment that moves goods rapidly and at the lowest cost.
Financial accounting measures the cost of the equipment.
Finally, Lands' End's managers must decide how the company will finance its operations. There is no standard answer. Sometimes there is an advantage to borrowing. In other cases, it is better to issue stock. However the company finances operations, financial accounting measures the cost of obtaining the funds.