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Management Accounting System

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Added on  2020-06-06

Management Accounting System

   Added on 2020-06-06

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Management Accounting
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Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1 ...........................................................................................................................................1P.1 Essential requirements of management accounting system .................................................1P.2 Different methods used for management reporting system .................................................3TASK 2............................................................................................................................................5P.3 Calculate costs using different techniques of cost analysis to prepare an income statementof marginal and absorption ........................................................................................................5TASK 3 ...........................................................................................................................................7P.4. Advantages and disadvantages of planning tools for budgetary control.............................7TASK 4 ...........................................................................................................................................9P.5 Comparison in methods of firms in adopting management accounting systems to solvefinancial problems .....................................................................................................................9CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
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INTRODUCTIONManagement accountingis the system which consists of different accounts, records andother relevant data which is helpful for the managers and thus they can take important decisions.This also helps the managers to evaluate these statements so that they can create plan andpolicies for the future (Song, Wang and Cen, 2015). It also helps them to have knowledge aboutthe expenses and profits so that they can create contingency plans and policies regarding thecosts and revenues. They can also do the forecasting of future and improve their performance bycomparing actual with standard data. Report discusses about Taj Stores which is a retail firm. Itis founded in 1936. Company is a grocery store and sells good quality of food such as fruits,vegetables etc. To the customers. Project explains about the management accounting andessential requirements of this system as well as different methods for management accountingreporting. Assignment deals with the costs using appropriate system to prepare income statementusing marginal and absorption costs. Report discusses about the advantages and disadvantages ofdifferent types of planning tools used for budgetary control and methods of comparison oforganisation to adopt accounting system so that they can respond to financial problems. TASK 1 P.1 Essential requirements of management accounting system Management accounting is the system in which relevant and useful information related toexpenses and profits are provided to managers. It is done so that they can take relevant decisionsrelated to budget and can also forecast regarding the future. This is also crucial so that they cancommunicate relevant information to the employees. Different essential requirements ofmanagement accounting system of Taj Stores are as follows-Inventory management system – Through this system, there is no overstocking andunder - stocking of the inventory. Management can easily handle all the goods which are storedin the warehouse. Manager can maintain right quality of the products in the warehouse. Hence,there is no wastage of the materials and the stock. It prevents under - stocking of goods. So, theproducts are easily available to the customers in time. Management accounting helps themanager in maintaining good balance between the demand and supply of the products. Throughthis it increases the satisfaction level of customers (Strauss, Kristandl, and Quinn, 2015). It alsoprevents the problem of overstocking of goods; thus, there is no wastage of materials and stock.1
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