Management Accounting and Different Methods

Management Accounting

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................4
P1) Explain management accounting and different kinds of management accounting system.. 4
P2) Examine the various method of management accounting. ..................................................5
TASK 2............................................................................................................................................6
P3) Determine the cost with the help of various methods such as cost examination and
developing income statement, marginal and absorption costs....................................................6
TASK 3..........................................................................................................................................12
P4) Discuss the advantages and disadvantage of different kinds of planning tool in order to
budgetary control......................................................................................................................12
TASK 4..........................................................................................................................................15
P5) Comparison between enterprises in order to effectively managing the function of
management accounting in order to solve the financial problems............................................15
CONCLUSION..............................................................................................................................18
REFERENCES..............................................................................................................................19

INTRODUCTION
Management accounting is process which refers to organisation effectively recording
transaction as well as estimate cost and expenditure in order to find out the proper result which
are helpful to achieving organisation goal and objectives. It is method and process which refers
to manager properly implementing this strategies due to enhancing profitability and productivity.
It considered as various tool and techniques which are effectively applied due to enhancing
profitability and productivity (Alawattage and et. al., 2018). The report is Pearl Chartered
Accountants which refers to organisation are situated in UK as well as managing business
operation effectively and efficiently. The paper consist is management accounting system,
method as well as comparison between the organisation in order to effectively managing
management system and adapting various techniques in order to smoothly operating business
activity and operations. It involves various tools such as performance, account receivables,
inventory, budget report and so on.
TASK 1
P1) Explain management accounting and different kinds of management accounting system.
It is process which refers to effectively conducting management accounting activity and
task in order to managers taking effective decision which are helpful to attained organisation
goal and objectives. It involves managerial accounting in order to identify, analysing,
communication due to workforce effectively conducting financial accounting system within
organisation. It includes management accounting is process in order to developing financial
report and maintain proper transaction and entries which are used by financial department as well
as properly allocated resources (Baghoumian and et. al., 2017). In context of Pearl Chartered
Accountant, it is an accounting consultancy organisation in UK which are advice to many other
services in order to effectively developing management accounting department in order to
effectively accomplishing organisation goal and objectives.
Principle of management accounting
Accuracy: While formulation of reports and statement of management accounting it is
essential that all the data or information use while formulation of statement is accurate and

reliable , other wise, organization not able to proved accurate information towards their internal
users.
Communication: All the information must be forwarded towards the essential interested parties
of organization. Thus relevant information and decision took must be communicate to reach
department of organization.
Value analysis: All the data which is include at the time of recording transaction must be valued
in monetary terms. Only then manager able to formulate their statement of cost as well as record
transaction in journal formate.
It is essential to each and every business model in order to maintaining profit, financial statement
and balance sheet which are helpful for managers in order to making effective decision as well as
smoothly run the business functions. There are various management accounting system which
are used by an organisation so discussed below.
Job coasting system-: It is system which refers to organisation analysis the need of
particular product and service and the manufactured. In relevance of organisation, accountant
costing of each product and services and accordingly allocate resources effectively and
efficiently. In costing procedure involves the various elements such as receive enquiry about
product from client, price, order received, cost recorded and so on. It is helpful to developing
final report and financial statement which are providing by accountant. The main advantage of
this system which refers to evaluating need and demand of customers accordingly developing
products on the basis of cost.
Price optimising system-: It considered as effectively analysis prices of products and
each product has set different price due to fluctuation in demand and market situation. It is
essential to an organisation to control the price of product because customers are influencing in
the price of product and set accordingly (Daryanto, 2019). It is effective tool and techniques for
organisation in order to maintain adequate price of product in the marketplace.
Inventory management system-: It is system which refers to monitoring asset and stock
of company in order to properly used by organisation. In management accountability various
method are used in this system such as EOQ, JIT approach, ABC analysis and many more. All
this techniques are effectively implemented in order to maintaining the stock of inventory as well