Management Accounting INTRODUCTION 3

Management Accounting

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
A. Difference between management and financial accounting ..................................................3
B. Cost accounting systems.........................................................................................................4
C. Inventory management system...............................................................................................5
D. Job costing system..................................................................................................................5
E. Different types of Management Accounting Report..............................................................6
F. Benefits of using management accounting systems:..............................................................6
TASK 2............................................................................................................................................7
a. The number of tickets that must be sold to break even (i.e. the point at which there is
neither profit nor loss).................................................................................................................7
b. If we want to make a profit of £30,000.00, how many tickets should be sold?......................7
c. What profit would result if 8,000 tickets were sold? ...........................................................8
TASK 3 ...........................................................................................................................................8
a. Evaluation of budgeting which can be used by Ever Joy Enterprises as a planning and
problem solving tool ..................................................................................................................8
b. Evaluation of financial governance which can help to pre-empt or prevent from financial
losses.........................................................................................................................................11
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
Management accounting is the analytical concept which involves determining, analysing,
interpreting and presentation of accounting information that is collected with the help of cost and
financial accounting. It helps in creating budgets, perform assets, cost management and
formulation of other financial reports (Csutora, M., 2012). This project is based on the case study
of Ever Joy Enterprise that deals in leisure and entertainment industry in UK. The company has
approached KPMG UK to prepare their draft for their management accounting department. The
report will present a deep understanding of Management Accounting System, its types and roles.
Apart from this, a detailed explanation about different management techniques will be discussed
along with various planning tools and their use with advantages/disadvantages. Further a
comparison of ways in which firm can apply management accounting in responding to its
financial issues will be discussed.
TASK 1
A. Difference between management and financial accounting
Management Accounting System
This is the process of identifying, measuring, analysing, interpreting and communicating
the information to the managers for pursuing the organisation goal. Management accounting
helps the managers to make the day to day decisions in the organisation. Basically it helps in
preparing management report and accounts that provide accurate and timely information’s
(Zainun, Tuanmat and Smith, 2011).
Financial Accounting
Financial accounting deals in preparing the financial statements of company's like
balance sheet, income statement and cash flows of the company's. It helps in disclosing the
overall business performance and financial health. Basically financial accounting is created for
its investors, creditors and industry regulators.
Difference between Management Accounting and Financial Accounting
Particular Management Accounting Financial Accounting
Objective The main objective of
management accounting is to
assist the management in
The main objective is to
provide financial information
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