Management Accounting of Ryanair
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Added on 2020-07-22
Management Accounting of Ryanair
Added on 2020-07-22
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Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1 Various kinds of accounting systems:...............................................................................1P2: Several approaches of management accounting reporting system ..................................2M1...........................................................................................................................................4D1...........................................................................................................................................4TASK 2............................................................................................................................................5P3 Net profit as per marginal and absorption costing method:.............................................5M2...........................................................................................................................................6D2...........................................................................................................................................6TASK 3............................................................................................................................................6P4: Advantages and disadvantage of planning tools use for budgetary control.....................6M3:.........................................................................................................................................8D3:..........................................................................................................................................8TASK 4............................................................................................................................................8P5: Comparison of financial problems arises in Ryanair with Lufthansa airlines ................8M4:.........................................................................................................................................9CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONIn present the scenario, it has been seen that management always looking to use bestaccounting systems that can assist in generating more effective outcomes for an organisation. Ithas been seen that management accounting systems are one of the most useful tools that canassist in managing and record on financial transaction in more systematic manner. Through this,managers should make proper understanding of different systems and report that are useful intaking crucial decision-making in context to the Ryanair company. The primary motive of thisproject report demonstrate several types of report those are helpful for Ryanair company. By thisthere long and short-term objectives can be attain in more effective manner (Hilton and Platt,2013).However, specific information about various accounting systems and cost techniqueswhich are helpful for assessing overall net profitability of the company. Apart from this, projectwould guide certain planning tools which are related with budgetary control. Henceforth, thisreport will assist in effective measurement of financial issues those are present in the mentionedcompany are discuss under this report.TASK 1P1 Various kinds of accounting systems:As provided in the case study, as this can be said that Ryanair Airlines services thatoperates two countries which are UK and Ireland. This is emerged in 1985 by the Ryan family.The main objectives of this airline organisation for rendering the best and efficient services to thepassengers so that the company could gain the sustainability for their business operations.Nowadays, Ryanair airline have uses their business operations in an effective manner by usingvarious management accounting system in an effective manner.Cost Accounting System: This is the cost accounting system which helps to reduce thecost of the product or services in an effective manner. Here, in the case of Ryanair Airlines usescosting accounting system which ultimately helps to lower the price of the passengers in aneffective manner (Youssef, 2013). The cost accounting system is the effective tool that can beused by the organisation in order to gain their business sustainability in an effective manner.Earlier, the traditional costing method was used by the organisation for lowering the cost of theirproducts. But this is the modern costing approach which helps the organisation for lowering theproduct or services in an effective manner.1
Job Costing System: This is the job costing system which is used at the time when theproduct is produced in a lot. This is the costing tool under which various products are made in asingle lot and the cost is assessed for a lot not for a single quantity. This is the quantity which isused for making the sustainable development. The Job costing is the tool which is used by theorganisation where the manufacturing of the products are done. Job costing system helps theorganisation in order to assess the cost of a particular lot.Price optimisation system: This is the most effective tool which is used by organisationfor optimising the price of the product in an effective manner. By using this tool, company wouldget to know about the competitors price so that the products or services of the quoted companywhich could make an effective strategy for gaining the sustainability by gaining the competitiveadvantages via lowering the price of the product (Klemstine and Maher, 2014).Inventory management system: this is one of the most crucial accounting system whichis used by the organisation in order to optimise the inventories in an effective manner. Inventorymanagement system helps the organisation for maximising the available resources in an effectivemanner. However, the main obstruction for using this inventory management system is to lowerthe cost in an effective manner. By using this system, inventory is managed effectively so thatthe business could gain the sustainable development and also take initiatives to lower the cost ofthe product. Now the Ryanair airlines needs to adopt this management accounting systems sothat they could attempt to gain the sustainability and also helps the organisation to lower the costof the product in an effective manner. There are certain tools in order to lower the cost in aneffective manner. These all are the modern accounting approach which ultimately helps to gainthe sustainability. There are certain tools which could gain the sustainability in an effectivemanner. The management accountant uses these tools in an organisation so that the organisationcould attain the competitive advantage over the other rivals. P2: Several approaches of management accounting reporting system It has been seen in various profit motive companies which are operating in manufacturingor service sectors that they are having certain issues that are related with recording of financialtransactions. The managers of Ryanair aircraft's use to protect their operations resources of lossesthrough using appropriate reporting system. A report is known as systematic record of all thefinancial transactions those are being done by company in their one fiscal year of time. It isnecessary for them to manage their valuable aspects that can helpful them in increasing2
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