Managerial Accounting: Evaluating Financial Performance and Future Projections of A2 Milk Company Limited

Running head: MANAGERIAL ACCOUNTING
Managerial Accounting
Name of the Student:
Name of the University:
Author’s Note:
Course ID:

1MANAGERIAL ACCOUNTING
Executive Summary:
The report has focused on evaluating the financial performance of the A2 Milk Company
Limited for 2018 along with anticipating future performance depending on a number of
assumptions made by the organisation. It is an ASX listed organisation producing milk and other
dairy products operating in Australia and New Zealand. By enforcing adequate marketing
techniques, the A2 Milk Limited Company Limited has the ability of meeting the budgeted
income target by increasing its product demand in the market. The increase in overall sales of
the firm is critical, since the management could generate the adequate cash flows to meet its
expenses and outflows. The projected income statement of the A2 Milk Limited Company
Limited is found to be suitable for the organisation in comparison to the financial performance
in 2018. However, it is to be noted that the generated budgeted figures are not in tandem with
the income statement prepared by the organisation in 2018. Therefore, it is crucial to develop
the budgeted income statement depending on relevant growth observed in the past accounting
year.

2MANAGERIAL ACCOUNTING
Table of Contentss
Introduction:.................................................................................................................................. 3
Part a:............................................................................................................................................ 4
Part b:............................................................................................................................................ 8
Part c:........................................................................................................................................... 11
Part d:.......................................................................................................................................... 13
Conclusion:.................................................................................................................................. 14
References:.................................................................................................................................. 16

3MANAGERIAL ACCOUNTING
Introduction:
The report has focused on evaluating the financial performance of the A2 Milk Company
Limited for 2018 along with anticipating future performance depending on a number of
assumptions made by the organisation. It is an ASX listed organisation producing milk and other
dairy products operating in Australia and New Zealand (The a2 Milk Company 2019). In
addition, a detailed discussion of the top-down and bottom-up approaches to the budget
process is made in this paper. Furthermore, the income statement for 2019 has been
estimated, which could help in determining the future income of the firm. Adequate analysis of
the components of master budget is conducted for determining the impact on the overall
financial performance of the organisation. The analysis of the components of master budget
assists the management to identify income and expenses, which is anticipated to carry out the
business operations in future. By assessing the projected income statement, it would help in
adopting suitable measures for the organisation for generating the desired level of income.
Finally, the report covers comparison of the actual income statement of 2018 with the
budgeted income statement of 2019 for the A2 Milk Company Limited.