What type of accounting focuses on gathering, summarizing, and reporting data?

The focus of gathering, summarizing, and reporting data aligns primarily with financial accounting. This branch of accounting is concerned with the preparation of financial statements that provide a clear picture of a company's financial position and performance to external stakeholders such as investors, creditors, and regulatory agencies. Financial accounting emphasizes accuracy and compliance with generally accepted accounting principles (GAAP), ensuring that data is systematized and reported in a way that stakeholders can easily understand.

Managerial accounting, while it may involve data gathering and summarization, primarily aims to provide information for internal decision-making purposes. It focuses on detailed financial and operational information that management uses to plan, control, and evaluate performance. Therefore, while both managerial accounting and financial accounting collect and summarize data, the key distinction is the intended audience and purpose of the information presented.

In cost accounting, the focus is specifically on capturing and analyzing costs associated with production, which helps managers make informed decisions about pricing, budgeting, and cost control. Tax accounting, on the other hand, specializes in compliance with tax laws and regulations, ensuring that organizations accurately report their tax obligations but not primarily concerned with general financial data reporting.

Therefore, the correct type of accounting that centers on gathering, summarizing, and reporting financial data for external use