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Report On Imda Tech Limited - Management Accounting Concepts

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Added on  2020-02-05

Report On Imda Tech Limited - Management Accounting Concepts

   Added on 2020-02-05

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Management Accounting
Report On Imda Tech Limited - Management Accounting Concepts_1
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................3P1 Management Accounting V/S Financial Accounting.............................................................3P2 Management Accounting Systems.........................................................................................4M1 Benefits & Application of Management Accounting Systems in relation to Imda TechLimited.........................................................................................................................................5D1 Critical evaluation on Management Accounting Systems with organizational processes.....5TASK 2............................................................................................................................................6P3 Absorption and Marginal Costing..........................................................................................6M2 Application of Techniques and Reconciliation of Profits.....................................................7D2 Interpretation of Data.............................................................................................................8TASK 3............................................................................................................................................8P4 Advantages and Disadvantages of Budgets............................................................................8M3 Preparation and Forecasting of Budgets................................................................................9TASK 4..........................................................................................................................................10P5 Balance Scorecard Approach................................................................................................10M4 Response to Financial Problems..........................................................................................10CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
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INTRODUCTIONManagement Accounting is as important in the business as food for the human body.Management accounting is comprises of two accounting which is financial accounting and costaccounting. Management accounting these days have become more famous and manyorganizations have adopted this technique in order to make things clear at the workplace andmake decisions for the future operations(Chiekezie, Egbunike and Odum, 2014). Managementaccounting is a vast subject in which various departments of organizations are studied and costrelated matters are studied in it which in turn makes the decision-making easier. The present report is undertaken in order to make necessary understanding related toManagement accounting concepts to the senior as well as departmental level and furtherdecisions related to financial information can be made so that it will benefit the Imda TechLimited to launch its new unique product of charger for mobile telephone and othergadgets(Ghasemi and et.al., 2016). Further this report will discuss Imda tech Limited problemsolving capabilities in relation to financial problem. TASK 1P1 Management Accounting V/S Financial Accounting Management Accounting is a concept which covers a wide area of business which inturn gives the managers a view at different prospects of carrying out the businesses thusinvolving this type of accounting in business is of utmost importance because it facilitates thedecision-making process and decision making in every business is an essential part which in turnfacilitates the existence of the organization. Management accounting is nothing it is the processof evaluation of operations of business of different departments. Management accounting can beunderstood as measuring, preparing, accumulating, analyzing, preparing, communicating andinterpreting the information related to financial or cost factor of the business(Luft, 2016). Thusby this report an attempt has been made to understand the concepts and conventions ofmanagement accounting practices and go beyond the practicality of them, like how they areapplied etc.Management accounting is somewhat different from financial accounting. Managementaccounting deals with the financial aspect as well cost aspect of the products and services thus it
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can be said that Management accounting is a broader concept than financial accounting. Infinancial accounting the finance related matters are been discussed among the financeprofessionals because they have the knowledge of the respective subject which in turn will helpin making appropriate decisions and same is with management professionals also as they aremore concerned with the vision of looking company at the upper positions they will make certainadjustments which will help in gaining competitive advantage(Myrelid and Olhager, 2015).P2 Management Accounting SystemsIn management accounting there are different set of systems which in turn will help ingaining the knowledge regarding the management accounting more and they are:1.Cost Accounting System: Imda company follow this system on a continuous basis andkeeps records of cost incurred on goods and services of different departments which inturn is taken into consideration to know actually how much the expenses are(Du andTaylor, 2013). This system is a common system for many of the organizations and thus itmeets the competition and also helps in analyzing the profitability.2.Inventory Management System: Since Imda is a retail sector company and deals insupplying daily usage products it is important for Imda to make the inventory levels keepup to date in order to meet the demand of the customers who comes to buy theproducts(Orelli, Padovani and Katsikas, 2016). So managers of Imda also should as perthe knowledge of the subject matter that they have to introduce the mobile charger in themarket should keep a record of inventory time to time and makes them aware about theneed of future.3.Job-costing Systems: This method is used where the individual customer has differentdemands and has the desire of something unique. Which means for every customer thereis a customized product which is likable by people and there is a different set of productwhich the customer likes. It is suitable where the work is done as per the customersrequirement is.4.Price-Optimizing Systems: It is a system which makes or allows Imda to know howsensitive its existing clients are to changes in product prices to enable it arrive at definedprofitability levels.
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