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(solved) Management Accounting Analysis

   

Added on  2020-10-05

15 Pages5164 Words240 Views
MANAGEMENTACCOUNTING

Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1Explain the management accounting and the essential requirements of managementaccounting...................................................................................................................................1P2 Different methods used for management accounting reporting.............................................3M1 The benefits of management accounting systems and their application within a business..5D1 Management accounting system and management accounting reporting.............................5TASK 2............................................................................................................................................5P3 Cost using appropriate techniques of cost analysis to prepare income statement usingmarginal and absorption..............................................................................................................5M2 Range of management accounting techniques and produce appropriate financial reportingdocument.....................................................................................................................................8D2 Produce a financial reports that accurately apply and interpret data for a range of business.....................................................................................................................................................8TASK 3............................................................................................................................................9P4 Advantages and disadvantages of various type of planning tools used in budgetary control9M3: Analysis of various planning tool and its application for forecasting...............................10D3: Evaluation of planning tools for responding to financial issues........................................10TASK 4..........................................................................................................................................11P5 Compare the ways how organisations are adapting management accounting.....................11M4: Analysis of planning tools to deal with financial issues....................................................11CONCLUSION..............................................................................................................................12REFERENCES .............................................................................................................................13

INTRODUCTIONManagement accounting is another form of managerial accounting. Managementaccounting not only assist the management structure in maintaining better formulation andexecution of business operations but also helps to manage the departments in effective manner(Zopiatis, Constanti and Theocharous, 2014). Meaning of management accounting and essentialrequirement of types of management accounting systems will be explained in this report .Different methods of management reporting which remain integrated with managementaccounting systems are also considered in this report. Type of cost accounting systems in termsof analysing the profitability and performance of organisation also defined in this report.Planning tools which assist budgetary control process for sustainable business decision makingdefined in this report. Use of management accounting system in terms of solving the financialissues of organisation also defined in this context. Comparison of organisation with twoorganisation that how management accounting assist the business operations. Airdri which is ahand dryer manufacturing organisation taken to elaborate the concept of managementaccounting.TASK 1P1Explain management accounting and the essential requirements of management accountingManagement accountingAccounting and bookkeeping done for management perceptive is considered asmanagement accounting. Management accounting contains accounting concepts, presentation ofaccounting information, policies, standards, management strategies and plans are considered inthis context. There are various types of business transactions, events, incidents happened in dayto day business operations. Proper recording and retention structure helps in managing theseinformation in strategic and effective manner. Management accounting is one of the importantaspect in terms of managing operations and department of attain the desired outcomes oforganisation (Zainun Tuanmat and Smith, 2011). Management accounting contains in depth knowledge and concept regarding effectiveoperation and management of business. Collecting valuable information, data and source to makeeffective management plans and strategies are the main elements considered in this report. Thereare separate rules and regulations made in terms of recording the transactions as monetary,1

financial, non financial, patent rights, contracts and agreements are recorded in effective mannerso that proper evaluation and revaluation made for effective decision making plans. Management accounting system provides a tool to managers and accountants to track themanagement record and performance of organisation. Business decision making and strategicplanning is the essential aspect in terms of determining the aim and objectives of business.There are type of management accounting system are used by organisation as perorganisational structure:- Cost accounting system: This is a system which helps to identify the key elements andmaintain effective cost structure for association. Minimising the cost and enhancing theprofitability and revenue growth is the main objective of cost accounting system (Windolph andMoeller, 2012). Cost accounting mainly helps to incorporate the cost form various departmentsand centralised them in a single format to calculate overall cost of operations and functions.There are type of complicated and critical situation found in business environment due to whichorganisation has to pay extra cost to overcome those situations. An effective cost accountingsystem provides a path and structure to track the cost of production, administration andoperations of business. This accounting system mainly used by manufacturing and productionorganisation.Inventory management system: This is the main accounting system which helps totrack the volume of stocks and inventories used for manufacturing and producing goods andservices. Supply chain management, production management, analysing the economic orderquantity are the main elements considered in inventory management system. It covers theproduction to retail, warehouse shipping and the movement of stock and parts betweenproduction departments. There are type of inventory control method are formed to manage andcontrol the level of inventories as EOQ method, ABC method to track the performance oforganisation. Market tracking, inventory levels for parts and finish products, automaticrecording, barcode reader system, integration with ERP or maintenance software. Airdri will beable to manage the order of quantity of raw stock and evaluation the quantity to be required forminimum product line. Job costing system: This is the costing system which mainly used by organisations toconsolidate the information and details in terms of determining the cost of each department andsection. It helps to assume the cost of different sections and contents in terms of analysing the2

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