Management Accounting Systems and Budget Preparation

Management
Accounting

Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
Demonstrate an understanding of management accounting systems:....................................3
1.1...........................................................................................................................................3
2.1:..........................................................................................................................................5
2.2...........................................................................................................................................9
2.3.........................................................................................................................................10
(a.).........................................................................................................................................11
(b.)........................................................................................................................................12
PART 2..........................................................................................................................................13
3 Preparation of Budgets:.....................................................................................................13
4.1 Comparison of enterprises that conform to MA systems to address the financial issues:17
4.2 Ratio analysis:................................................................................................................17
4.3 Evaluation of the planning tools:....................................................................................19
REFERENCES..............................................................................................................................21

INTRODUCTION
Managerial accounting may be considered an accounting division that analyses the definition,
review, calculation, and evaluation of business-related information that management utilize to
take decisions dependent on evaluation/analysis as well as helps handle the activities of the
organization better (Bennett and James 2017).
This study evaluates multiple elements and related aspects of management accounting
with regards to UCK furniture. It also cover several practical sum related to MA techniques and
preparation of budget.
PART 1
Demonstrate an understanding of management accounting systems:
1.1
Management Accounting: This may be characterized as a collection of practices aimed at
encouraging management and allowing them to be prepared with the facts and data required to
make management decisions in support of an enterprise.
Importance of MA: It is imperative for decision-making phase of management within entity. It is
also important for political and corporate strategy formulation. It assists in
managing outputs, performance and task management which assists in making operations more
effective. It is most critical management framework because it also helps to maximize operating
performance and hence to raise revenues (Burritt and Tingey-Holyoak, 2012).
Perquisites of MA: The entire process of MA depends on raw data and details which is
converted in meaningful information for managerial decision-taking process. This require
adaption of frameworks which support in decision-making.
1.2
MA Systems: These are several specified MA systems that provide clear mechanism for the
adaptation of managerial accounting processes, as below:
Inventory management system: This deal largely with successful handling of inventories. The
system/framework includes detailed documentation pertaining to each organisation's product
object. It makes it possible for administrators to handle all product items and supplies and reduce
associated cost of production. This allocates the crucial deficiencies in inventory-related
programs to help managers define significant factors that influence total cost of inventories.

Job Costing System: This focuses primarily on defining work processes and allocating
expenditures to each given job-process. It is a common framework that includes internal process
oversight. This program needs detailed details which effectively classifies tasks and expenses
associated with these functions (Cazier, Rego, Tian and Wilson, 2015).
Price optimisation system: The most powerful and relevant structure through which different
goods / products can be priced correctly. This helps management modify or sustain a new sale
price, which often means the existing costs ought to change. This also helps managers to draw up
a marketing strategy and to implement strategies for demand determination. To evaluate most
cost-effective price for particular products, this approach requires technological and
organizational experience as well as use of certain approaches/methods.
1.3
Several crucial Benefits/advantages of discussed MA systems:
MA-Systems Core Benefits
Inventory Management This is indeed vital for the business in
which inventory movement throughout the
business is observed and positioned. This also
lets managers
use organisation's inventories/stock items
effectively.
Job Costing System It is especially beneficial in terms of achieving
efficiency and effective/efficacious allocation
of different costs to specific business processes
/ jobs (Christ, 2014).
Price Optimisation System It's effective in assessing most sustainable
prices for goods and services for development
and handling workers and also in assessing the
quality of things manufactured/produced. This
system provides basis for setting prices.

1.4 Critical examination of how MAS and MA are integrated to the processes of the
organization:
As an organizational process, multiple procedures and operations/tasks act as core basis
for various systems/frameworks of MA. The results of various organizational processes are
important considerations for the above systems. Managers perform manager procedures for
productions, accounting and financial services, such as costs details, stock levels, requirements
and several other accounting/budgetary details, as is case for UCK. All procedures with MA
frameworks therefore need to be integrated.

2.1: