Benefits of Management Accounting System
16 Pages3776 Words280 Views
Added on 2020-02-03
Benefits of Management Accounting System
Added on 2020-02-03
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ContentsINTRODUCTION...........................................................................................................................4TASK 1............................................................................................................................................4(a)Management accounting.........................................................................................................4(b)Different types of management accounting............................................................................5M1 Benefits of management accounting system.........................................................................5D1 Integration of management accounting system and management reporting system in organizational process.................................................................................................................6TASK 2............................................................................................................................................6Income statement of Imda tech....................................................................................................6M2 Techniques of management accounting................................................................................2D2 Interpret the data for the business activities...........................................................................2TASK 3............................................................................................................................................3(a)Types of budgets their advantages and disadvantages............................................................3(b) Process of preparing the budget.............................................................................................4(c)Pricing Strategies.....................................................................................................................4M3 Use of different planning tools..............................................................................................4D3 Role of planning tools in solving financial problems............................................................4TASK 4............................................................................................................................................5Balance scorecard and its implementation..................................................................................5M4&D3 Planning tools................................................................................................................5Conclusion.......................................................................................................................................5References........................................................................................................................................6
INTRODUCTIONThis report contain all the relevant information relating to the management operations of Imda ltd. Present report shows the relevant information like what is management accounting and what is financial accounting and how management accounting provide relevant information to the managers in taking important decision for the enterprise. What is cost accounting system, inventory management system, job costing system and pricing optimizing system is detailed under this report. How many types of budgets are there and how the enterprise can be benefited by making the budgets. How these budgets can help the Imda ltd in achieving its objectives. Thisreport tells how Imda ltd can use the concept of balance scorecard and how this can help them in achieving their operation efficiency. Absorption and marginal costing are described under this. What pricing strategy should a firm use to fix the price of its products and services is described under this.TASK 1(a)Management accountingManagement accounting is a technique of using all the relevant information collected with the help of accounts department of the enterprise in order to achieve the efficiency in the business operations. The concept of management accounting is based on the information of financial and non financial data of the enterprise.Difference between Management accounting and financial accountingManagement accounting is a technique to provide that information to the managers whichwill help them in taking useful decisions for the enterprise. By using or apply this managers can better take the decision in maximizing the profits of the business.Financial accounting is a process dealing with the monetary terms it mainly deals with the financial statements of the enterprise and evaluate them in order to improve the performance of the financial system of the enterprise.Importance of management accounting system as a decision making tool Every business enterprise has to take lot of important decisions and management accounting helps them in taking appropriate and more effective decision by provide them useful information(Kaplan and Atkinson, 2015). The importance of management accounting can be understood by the following points:Relevant cost analysis: Management accounting system helps the mangers in taking relevant cost decisions. Management accounting helps the enterprise in deciding what method should be adopted by them in achieving the objectives with minimum cost.
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