Management Accounting and People and Organisation Management in the Built Environment

PEOPLE AND
ORGANISATION
MANAGEMENT IN THE
BUILT ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
PART A...........................................................................................................................................3
Preparation of Monthly Control Report for Amana Ltd..............................................................3
Report on Amana’s performance.................................................................................................5
Recommendations to improve the performance of Amana Ltd...................................................6
PART B............................................................................................................................................7
Analysis of two alternative method for online selling.................................................................7
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Management accounting is the branch of accounting that comprises the elements of both
financial and cost accounting. Management of people and organization is essential for the
desirable performance of the business entity. The report will prepare original, flexed and
variances for Amana Ltd. Based on the budget report the study will report the performance of the
company and suggest the improvements. Two selling options will be analyzed and best will be
advised to the firm.
MAIN BODY
PART A
Preparation of Monthly Control Report for Amana Ltd.
Amana Ltd
Original Budget Report
Original Budget Actual Variance
Favorabl
e /
Unfavor
able
Per Unit In
Amount
Per
Unit
In
Amoun
t
Per
Unit
In
Amou
nt

Units 100000 80000 20000
Selling Price 25 2500000 20 160000
0 5 90000
0
Unfavora
ble
Variable Cost:
Materials 2.5 250000 3.5 280000 -1 -30000 Unfavora
ble
Labour 4 400000 5.5 440000 -1.5 -40000 Unfavora
ble
Overhead 1.5 150000 1.5 120000 0 30000 Favorabl
e
Contribution 17 1700000 9.5 760000 7.5 94000
0
Unfavora
ble
Fixed Overheads:
Warehouse Rental 2 200000 2.125 170000 -0.125 30000 Favorabl
e
Insurance 1 100000 1.25 100000 -0.25 0
Full time warehouse
supervisor salary 0.5 50000 0.437 35000 0.062 15000 Favorabl
e
Profit 1350000 455000
The above budget report shows the variances between the original budget
prepared by the company for the year 2020 and the actual events for the year. Sales
and production volume are assumed to be same. The variance in the sales and
production units, materials, labour and overhead are unfavourable for the company.
Variance in the warehouse supervisor salary and warehouse rental is favourable for
the company. There is no variance in the insurance overhead as it is same as the
budgeted amount.
Amana Ltd
Flexible Budget Report
Original Budget Flexible Budget