Management Accounting Assignment(MA )

MANAGEMENT
ACCOUNTING

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Research report on functions of management accounting.....................................................1
i) Management accounting concept and its differentiation from financial accounting..........1
ii) Importance of management accounting for taking decisions............................................2
b) Different management accounting system and its usage to improve reports.........................3
TASK 2............................................................................................................................................4
P3 Preparation of income statement by consulting absorption and marginal costing.................4
TASK 3............................................................................................................................................7
P4 Written report on planning tools............................................................................................7
a) Different types of budget and its limitation and advantages..............................................7
b) Process for preparing budget..............................................................................................7
c) Pricing strategy for Imda tech............................................................................................9
TASK 4..........................................................................................................................................10
P5 Balance scorecard and its use in Imda Tech for better decisions.........................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Management of each and every sort of business is must. It enables an organisation to take
appropriate decision which are beneficial for an entity. Management accounting is a process
which enables a firm’s decision makers to take appropriate steps on the basis of short term
reports (Baldvinsdottir, Mitchell and Nørreklit, 2010). This present assignment is based on Imda
Tech which deals in manufacturing of special chargers and other carry on services. Managers of
cited organisation have to maintain their short term reports which aid them in taking long term
financial decisions for the company. In this report several number of concepts are discussed
which includes importance of management accounting as a decision making tool. Also it is
completely different from financial accounting process. Moreover, importance of balanced
scorecard approaches depicted which enables management to take crucial decisions and helps in
analysing the performance of a company.
TASK 1
P1 Research report on functions of management accounting
i) Management accounting concept and its differentiation from financial
accounting
Management accounting is a financial statement or advice for a company through which
management is able to take appropriate decision for an organisations’ long term benefit. It is a
process of making reports and accounts that provides accurate and financial statistical
information required by the managers to help them make day to day and short term decisions.
This process supports an entity to operate in all segments in effective and efficient manner
(Bodie, 2013). Authority can formulate strategies by taking these reports in their account.
Managers can identify all changes which are concerned with their projects to take
beneficial decision which increase the chances of sustainability of operation. It is prepared on
short term provision of business. Hence, it is completely different from financial accounting
which provides a data for whole year. Financial accounting and managerial accounting both have
different formats and managers have to take both of them in their consideration while dealing
with varying situations. A basic differentiation between financial accounting and managerial
accounting is as follow:
1