Management Accounting Assignment [MA]
Added on -2020-06-06
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Management Accounting
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1Introduce a business and its product. Also prepare a cost card to calculate per unit cost ofstated product..........................................................................................................................1TASK 2............................................................................................................................................3Prepare different types of budgets..........................................................................................3TASK 3............................................................................................................................................5Calculate variance of different budgets and explain importance of calculating variances....5TASK 4............................................................................................................................................8"Management accounting is forward looking while Financial Accounting is more historical".Analyse the statement.............................................................................................................8CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11
INTRODUCTIONOrganisation is required to make its budget so that it may keep on track of its activities bymaking budget forecast and analysing actual results and finding out variances if any (Fullerton,Kennedy and Widener, 2014). The enclosed report is based on new company which is starting itsventure in food sector. As such, management accounting should be sound enough for effectiveresults.TASK 1Introduce a business and its product. Also prepare a cost card to calculate per unit cost of statedproductReportTo: From: Angel SyndicateSubject: Introducing a restaurantMission-The company is introducing the business of pizza restaurant. Foe demand fulfilment ofcustomers, it is launching its new business. Pizza has been preferred by almost of all agegroups. It will be help for company to establish and provides pizzas to public for theirsatisfaction. It is required that company should be efficient enough to provide services tocustomers. The mission of company is to establish brand image in front of the public so that itmay enhance them and satisfy them. It is required that organisation should deliver quality ofproduct to customers as when quality is not achieved, products fail. As a result, brand image islost. For ensuring proper quality, standards should be set by it so that customers are delightedby food experience. For starting restaurant, efficient staff is required which can deliver food tocustomers instantly and with full dedication. For this purpose, staff is hired by manager onbehalf of organisation. Key factor in firm is try to synchronise and coordinates team effort forachievement of objectives of organisation. Vision-The vision of company is to increased its market share and to broaden customer base. Forincreasing market share, it is required that it deliver product as per quality standards. Quality1
management should be efficient so that customers are delighted with by the experience. Marketshare can also be increased by implementing competitive strategies in ahead of competitors sothat organisation may lead ahead of them. By framing competitive strategies, it may flourish inthe market which ultimately maximises its market share. Next vision is to maximise customerbase which may be achieved by attracting customers by various schemes and discounts on foodproducts. This strategy can make speedy sales and eventually leads to increase in customerbase. Customer are delighted and satisfied by providing quality pizzas at lowest pricers andwhich makes effective sales of restaurant.Cost cardCost cardParticularsAmountDirect materials5Direct labour8Prime cost3Variable Overhead2Share of fixed cost per unit2Total cost per unit20Analysis of fixed cost-It is a cost that does not vary in short term. Whether, sales are increased or decreased, fixed costdoes not fluctuate. This cost remain fixed irrelevant top whether firm is earning well or not. Ithas to incur these expenses. Fixed expenses include rent payment for premises, depreciation andtaxes. It is used as financial analysis to find break-even point. It also helps in assessing productpricing (Renz, 2016). When fixed costs are low, variable cost per unit of product is high.Fixed costs are allocated under absorption costing. These costs are relevant top organisation toquote the price of product by analysing its fixed costs. Analysis of variable cost-It is a cost which varies in short run. It keeps on changing in business. It does not remain fixed.As sales increases or decreases, it also varies accordingly. It can be computed as sum ofmarginal costs over all units produced by firm. Example, operating expenses, wages and raw2
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