Management Accounting - Agmet company Assignment
Added on 2021-01-02
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Management Accounting
Table of ContentsINTRODUCTION ..........................................................................................................................1TASK 1............................................................................................................................................1P1 Management accounting and different types of management accounting systems...............1P2 Various methods which help in accounting report................................................................3M1 Various crucial benefits of using management accounting system......................................5D1 Critical evaluation of various reporting method and accounting system integration............6TASK 2............................................................................................................................................6P3 Marginal cost and absorption cost.........................................................................................6M2: Different types of accounting tools and techniques............................................................8D2: Analysis of data collected from income statement..............................................................9TASK 3............................................................................................................................................9P4 Advantages and Disadvantages of planning tool...................................................................9M3: Analysis of various planning tool and its application for forecasting...............................10D3: Evaluation of planning tools for responding to financial issues .......................................10TASK 4..........................................................................................................................................11P5 How company is opting management accounting system...................................................11M4: Analysis of planning tools to deal with financial issues....................................................11CONCLUSION..............................................................................................................................12REFRENCES.................................................................................................................................13
INTRODUCTION Management accounting is the procedure of preparing accounts and reports whichprovide accurate financial and statistical information required in the organization for making dayto day and short term decision. In simple term it can be said that, accounting in simply managing,summarizing and classification of financial transactions. In every company there is separatedepartment which records all the monetary transactions. This assignment is based on Agmetcompany which is an chemical products manufacturer as well there approx. 27 employees areworking. Below mention report is explaining management accounting and its need in theenterprise and several types of system (Amidu, Effah and Abor, 2011). Along with this, variousmethods assist in framing accounting reports is described. Moreover, income statement of thecompany is prepared by using absorption and marginal cost. The main purpose of this report is tounderstand the advantages and disadvantages of planning tool under the budgetary control. In theend, it explains how an organization have to adopt management accounting system in propermanner. P1 Management accounting and different types of management accounting systemsManagement accounting is the process which involve preparing and providing statisticaland financial information to the manager of company. So they, can make their daily basis orshort term decisions related to management in effective manner. Moreover, the same is alsoknown as managerial and cost accounting but it is different from financial accounting because itproduce or prepare reports for internal and external stakeholders (debtors, shareholder, investorsetc. and internal users are purchases, suppliers, employees etc.). The same also include detail ofenterprise sales revenue, available cash, accounts payable and receivable. Most important is that,information involved in this is confidential and for internal use only. Management accounting play important role for the manager of Agmet which is anchemical manufacturing organisation because it help them improving their decision makingpower (Carlsson-Wall, Kraus and Lind, 2015). It is necessary for every type or companies suchas sole proprietors, non-profit enterprises as well government also. Accounting in associationsdone on monthly basis for maintaining their cash inflow and outflow records. Apart from this,cost accounting is an procedure which assist in identifying business cost and operations forpreparing internal report related to the transactions. When day to day records are maintained it1
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