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Management Accounting in Unicorn Retail Company : Report

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Added on  2020-07-23

Management Accounting in Unicorn Retail Company : Report

   Added on 2020-07-23

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Management Accounting in Unicorn Retail Company : Report_1
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P 1 management accounting types of management accounting systems....................................1P2 Explain different methods used for management accounting reporting................................3TASK 2............................................................................................................................................4P3 Preparation of income statements by using marginal and absorption costing methods.......4TASK 3............................................................................................................................................7P4 Various planning tools and their advantages/disadvantages..................................................7TASK 4..........................................................................................................................................11P5 Comparison between management accounting systems and there role in order to respondfinancial constraints..................................................................................................................11CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
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INTRODUCTIONManagement Accounting is a techniques by which manager make a complete records ofeach and every transactions which affect the company's financial performance. It includesvarious accounting methods such as costing, budgeting etc. in order to identify the financialproblems which highly affects its level of performance. This report analysis the concept ofmanagement accounting and different types of management accounting system which providesessential informations. Different methods used by Unicorn retailed company, UK which is usedto make an accounting report effectively. It also describes the process of preparing incomestatement by using absorption and marginal costing method. Further, it also describes theadvantages and disadvantage of different planning tools for making effective budgetary control.At last, it also explains the role of management accounting system to handle or responds forsolving the financial problems in this report.TASK 1P 1 management accounting types of management accounting systemsManagement accounting is the process of taking part in the decision making through withthe help of accounting statistics. The management accounting is the making financial process tohelp the managers to make important decisions regarding the finance and other strategies(Baldvinsdottir, 2010). The management accounting is the tool which is used by the managers inthe preparation of plans and statical strategies which govern the working of the form. Thissystem also help the managers to control Unicorn's stores as it makes predictions which providethe management with standards to compare with the actual figures. This management accountingalso help the company to measure the performance by preparation of various analysis such asbreak even point, variance analysis etc. the management of the store is facilitated by the use ofmanagement accounting systems There are various system of accounting which are used in theaccounting process. Cost accounting systems : This system of accounting is the most common system. Costaccounting system is based on recording all the expenses in the books of accounting. Thisaccounting system focuses on the recording of production cost, all the expenses aredistributed under several heads (Marshall, 2016). The cost accounting system alsopredicts the future cost for the production of n number of products with the details of the1
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past data available and the money is allocated to the production section according tothose predictions. This system helps the manager of unicorn to record the all the expensesin the purchase of different products separately under the heads. The system is importantto the managers as they can predict the future performance of the stores with help ofmanagement accounting systems. Job costing system : when the business deals in creating authentic products on thedemand of the customers then the job costing method is used. Under this method the costof the of each product or service is recorded separately under the different job heads. Theessential requirement of job order costing is to record the cost of each job under adifferent job head. Job order costing makes use of different methods costing such asmarginal and absorption. These methods have a different perception towards recordingcost of each job. Unicorn uses this costing process manage the cost incurred inprocurement of product from the different suppliers.Inventory management system : The inventory management system is an important partin the working of the organization. This system helps the management to take a note ofthe unicorn's inventory. This system helps the company to also investigate any variationsor any other issue in the inventory. Under this system the recording of expenses incurredon inventory is also possible (DRURY, 2013). The record for each product is keptseparately in as the product line has to be identified in the many lines in the company.This helps Unicorn to keep record of the products in the stores with the use of inventorymanagement and also the cost which has been incurred in the storage and safety of theinventory in the stores and warehouse. There is a significant importance of the inventorymanagement system for unicorn. Price optimization : This system is vastly used by the business concerns. This systemfocuses on taking in consideration the current price at which the company is selling itsproducts and then helps the management to decide a price at which Unicorn must sell itsproducts in the store. This system is highly beneficial to Unicorn as it allows it tocompete in the market and also get an edge over its competitors. This system is alsohelpful to the management in making policies about the future prices and also deciding2
Management Accounting in Unicorn Retail Company : Report_4

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