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Management Accounting Report of Toyota Motors

   

Added on  2020-07-22

19 Pages6104 Words33 Views
MANAGEMENTACCOUNTING

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1 ...........................................................................................................................................1P1. Management accounting and essential requirements of its different types......................1P2. Different methods used for management accounting reporting.......................................3TASK 2............................................................................................................................................5P3. Income statements through absorption and marginal costing of Toyota.........................5TASK 3 ........................................................................................................................................9P4. Different types of planning tools used in budgetary control............................................9TASK 4 .........................................................................................................................................11P5. Organisation’s response towards financial problems by using management accounting11CONCLUSION..............................................................................................................................13REFERENCES..............................................................................................................................15

INTRODUCTIONManagement accounting provides solution on future possibilities which can be happen inthe company. It is related to identification, analyses and presenting financial information. Theplanning, decision making and controlling activities can prove to be effective only with properutilisation of information provided by such system of accounting. There are various tools andtechniques available with management accounting to provide administration with the necessaryinformation. A manager has to perform various functions of planning, organising, staffing,directing and controlling. It includes techniques that are important for planning activities whichdefinitely help in controlling the performance of organisation. This project is based on theToyota Motors. This project will be provide information on different types of managementaccounting, budgeting and costing methods which can be used by the company in makingprovisions. Planning tools are also required for the organisation in budget making which will bediscuss in this project. At the end of this project will provide actions taken by managers towardsfinancials problems by using management accounting tools and techniques. TASK 1 P1. Management accounting and essential requirements of its different typesA management accounting provides administration with various tools and techniques.Financial statement analysis, ratio analysis, cash flow statement, fund flow statement, budget andbudgetary control, marginal accounting, cost-volume profit analysis are the common tools usedin management accounting. Toyota motors is the most successful company of Japan because ofits appropriate decisions at right time. Management accounting, an important kind of accountinghas generally provide administration with various reports and analyses of budgets that helpcompany to set targets and accomplish the same. The successful planning and analysis can onlybe achieved with the help of management accounting. Making financial data as the most reliableinformation is the main key of management accounting. For surviving in a dynamicenvironment, smooth and effective functioning of various operations is must. That too can beimpossible without use of management accounting. Financial accounting only provides statementof income and Balance sheet. The same can be of no use without analysing them. Managementaccounting analyse such financial information and extract advantageous decision making data.Toyota is the highest car producer organisation in world. They have ton deal with day to day1

challenges that has been arise with them time to-time. A manager has to perform its managerialfunctions of planning, organising, staffing, directing and controlling. Such type of accountinghelps in various aspects of supply of raw materials, debtors, creditors, finance, budgets, revenuegeneration, credibility and profit analysis. To have effective operations, management preparebudgets such as cash budget, purchase budget, sales budget, and flexible budget too. The targetsare set based on such budgets and each division has to achieve its pre-determined targets. Theycan able to frame various strategies of business to deal in dynamic environment with the help ofsuch system of accounting. It contributes to strategies formulation and gaining an advantage overits rivals. The environment in which an organisation deals became complex. The competition hasbecome cut-throat and surviving in such environment with presence of numerous rivals is verydifficult. Despite of these facts, Toyota Motors has made enormous growth and gained hugeprofitability. They are among successful companies in auto mobile sector. Managementaccounting is helping administration with determination of financial cost and managerialperformance of business organisation. Effective in managerial functions is the essence ofbusiness. The reports are being presented to administration on a daily, weekly and monthly basis.They needs to spend massive amount of time considering such reports for taking importantdecisions in business. Modern techniques focuses on providing reports even on a daily basis. Thebudgets are prepared based on historical data. The targets are set and accomplish withinstipulated time. If found any deviation or variance, the same needs to be addressed andsupportive plans are being prepared. Management accounting is the accounting done foradministration of business organisation. Different kinds of management accounting can beclassified as follows- Cost accounting system- Cost accounting system is one of the most kind of accounting.Toyota is the highest car producer company in world. They needs to analyse cost ofmanufacturing cars. Raw materials, components and parts that are being used. This overall helpsin determination of profitability of products and services that Toyota is offering. This system, ofaccounting helps in cost determination and profitability. There are cost accounting professionalsthat manage such system of finance. Inventory management system- Inventory management system helps in management ofstocks in warehouses. They are the manufacturing company, hence required various tools, parts,2

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