Project Report: Business Accounting and Finance - Decision Making

This project report delves into various aspects of business accounting and finance. It begins with an introduction to management and financial accounting, emphasizing the importance of integrity. The report then addresses ethical issues, exploring ethical dilemmas faced by accountants, such as societal and personal friendship dilemmas. Further, the report covers costing concepts, including relevant range and break-even analysis, highlighting the limitations of break-even analysis as a misnomer. The decision-making section presents an analysis of the Monty Hall problem and other decision-making scenarios, including a case study involving probability distribution. The report also includes references to relevant academic sources. The project covers a wide range of topics essential to understanding the core principles of accounting and financial management.

Running Head: Business accounting and finance
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Project Report: Business Accounting and finance

Business accounting and finance 2
Que 3)
Introduction to management accounting:
Management Accounting:
Management accounting assists a firm in preparing the final financial reports along
with the other financial statement which are helpful for the company to manage the
information and figures of the company. These statements are prepared to identify the trustful
information related to the firm that assists the managers to make a better decision about the
company. It is required for every company to do the managerial accounting.
Financial Accounting:
Financial accounting assists a firm in preparing the final reports related to the
financial performance of the company which are helpful for the stakeholders and the
company to manage the information and make a better decision about the company. These
reports assist the managers of the company to make some effectual decisions for the better
performance of the company and more investment into the company (Saunders & Cornett,
2014).
Importance of integrity:
Integrity is a quality which must be hold by every accountant. Integrity defines about
the quality of being an honest person and having some strong principles. An accountant
knows every single detail about the performance of the company and thus it is required for
them to do not share the confidential information with any external body.
Problem with accountants:
This statement depict that an accountant is never eligible to be the top level
management like CEO of the company. I do not agree with this statement as an accountant
could also have the characteristics which are required to become a CEO of a firm. According
to the Forbes (2017), a person must be educated enough, individual must have awesome
personal characteristics and the career path of that individual must be strong in that
organization itself. Then it is possible for every accountant to be a CEO. Mark McQuter has

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become the CEO of the company, Revolution Bars Group. He is the biggest example which
proves that an accountant could also become the CEO of a company (GAA, 2017).
Que 4)
Ethical issues:
Ethical dilemma is a situation where an individual has 2 or more choices in front of
him and he or she has to choose one among them which are somehow beneficial for him or
her and the firm. In such cases, various personal and societal ethical guidelines could help the
individual to reach over a satisfactory outcome.
An accountant could face many cases in which he or she has to face the issue of
ethical dilemma such as an accountant could face the problem of societal dilemma. In this
situation, there would be two options in front of the accountant one would be in the favour of
the society and another one in the benefits of organization. For instance, accountant has to
choose in two options one is to improve the performance of the company through making the
changes into the final data of the company for the company or in another option, he could
present the same performance and position of the company through not making changes into
it for the benefit of the society.
An accountant could also have to face the problem of personal friendship. In this
situation, there would be two options in front of the accountant one would be in the favour of
the friend and another one in the benefits of organization. For instance, a debtor of the
company is the friend of the accountant. Now he has to choose in two options one is to
reduce the level of debt amount of the friend or second option is not to make any changes into
the debt amount (Deegan, 2013).
Que 5)
Qantas annual report:
(Refer to another file)
Que 6)
Costing:
a) Relevant range:

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The given statement depict that the relevant range cost are related to the fixed not and
not with the variable cost. This statement is quite true as the variable cost is the cost
where the cost get affected through increasing a single unit whereas in fixed cost, the
cost get not affected with any changes into the production units. In relevant range, the
cost get affected with huge changes into the production unit and thus it is not the part
of the variable cost and that is why it is a way better to relate it with the fixed cost
because at that time only, it would be easier for the managers to make a better
decision about the performance and the production level of the company.
b) Break even analysis:
Break even analysis is just a part of the cost volume profit analysis and many times,
this get affected due to the fact that there are various other cost also in an organization
except the fixed and variable cost such as semi variable cost out of which some part is
fixed in a company but that is not included by the managers while calculating the
break even analysis of a company and thus the break even analysis get mere
misnomer (Eliott & Eliott, 2007).
The break even analysis is a misnomer as it depicts the level where as the profit and
the cost of a company is at the same level. Mainly, two views are there to explain the
break even analysis of a company one is broad view and another one is narrow view.
According to the narrow view, this technique about the point where the profit and the
cost of a manufacturing house is same whereas as according to the broad view, this
technique depicts about the profitable state of a company.
Que 8)
a) Decision making:
If I will be on that position than surely I would change my decision and will select the
one door in which the car could be there. An analysis has been done over my ten
friends to analyze their answer. Their answers are as follows:
S.No. Name Choice
1 Mary No
2 Paul Yes
3 Raymond Yes
4 Aahna Yes
5 Eli No
6 Grehn Yes

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7 Grek Yes
8 Cham No
9 Chai Yes
10 Raiman Yes
Accoridng to the decision of my friends also, 70% of them would like to change teir
decision and 30% would like to go for the same dceision.
b) Monty hall problem:
According to the Monty hall problem, this is one of the puzzle, where there are
always 1/3 chances of a contestant to win but the host make it more tricky so that it
become tough for the contestant to choose the right door. Various simulation,
probability and other mathematical calculation depict that due to this action, a person
must not make the changes into it decision (Gill, 2011).
Through this analysis, I have found that it was a wrong decision to change the
decision; a contestant must not change his or her decision.
Decision making:
The decision taken by the man was not at all rationale as still there were chances of
that man’s report to be negative. According to the analysis, it has been found that 5% doctors
do not agree that he has serious disease and thus he must not quite everything and must do
check up again to identify and the probability factor is also in his favour.

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c) According to the case, 6 balls are of red colour and 4 are of black colour. So it is good
to opt for red colour as probability of finding the red colour is more than the black
colour. After 4 red balls, I would like t change my decision and then I will go for
black colour as now the probability of black colour is more than the red colour.
d) According to the above case study, it has been found that a human being has diverse
choices in front of him or her. It depends on him that how he chooses the best
decision which would be beneficial for him, according to this study, it has been found
that probability distribution and various other mathematical techniques are available
in the market which could be used by the human being to make a better decision (stat,
2017).
Probability distribution explains the human being about the more chances of a
thing to be occurred and on the basis of that a human being goes for that option and in
most of the cases, this decision becomes the trustworthy and successful.
Que 12)
(Refer to another file)

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References:
Deegan, C. (2013). Financial accounting theory. McGraw-Hill Education Australia.
Elliott, B., & Elliott, J. (2007). Financial accounting and reporting. Pearson Education.
GAA Accounting. 2017. Five chartered accountant who became CEOs. Retrieved from
http://www.gaaaccounting.com/five-chartered-accountants-who-became-ceos/ as on 7th
pct 2017.
Gill, R. (2011). Monty Hall problem. Mathematical Institute, University of Leiden,
Netherlands, 10-13.
Saunders, A., & Cornett, M. M. (2014). Financial institutions management. McGraw-Hill
Education,.
Stat. (2017). Random variables and probability distribution. Retrieved from
www.stat.pitt.edu/stoffer/tsa3/intro_prob.pdf as on 7th Oct 2017.