Management Accounting

Management
Accounting

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1: Management accounting systems..........................................................................................1
P2: Management accounting reporting........................................................................................3
M1: Benefits of Management accounting systems......................................................................4
D1: Critical evaluation of management accounting systems and management accounting
reports..........................................................................................................................................4
TASK 2............................................................................................................................................4
P3: Calculation of costs...............................................................................................................4
M2: Accurate application of management accounting techniques..............................................5
D2: Producing of financial reports for accurate analysis and interpretation of data...................5
TASK 3............................................................................................................................................5
P4: Advantages and Disadvantages of planning tools.................................................................5
M3: Analysis of different planning tools and their applications:................................................6
TASK 4............................................................................................................................................7
P5. Organisations are adapting management accounting system to respond to financial
problems:......................................................................................................................................7
M4: Analysis of responding management accounting system over financial problems:.............8
D3: Evaluation of planning tools.................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Management accounting refers to a process in which the use of various types of methods
and techniques by the managers of an organization so that they are able to ensure that they can
better manage the firm's financial data, facts and information in a highly effective manner
(Apostolou and et.al., 2016). Its use is quite crucial from the point of view of the organizations
so that they are able to achieve their short-term, medium-term and long-term goals and
objectives in the future. For this report, Capital Joinery Ltd. has been selected. It is a firm which
manufactures joinery, made-to-measure doors and windows. In this report, focus will be made on
demonstration of understanding of management accounting systems, calculation of costs,
explanation of the use of planning tools. Additionally, focus on Comparison of ways in which
the firms can make use of management accounting to respond to the financial problems will be
discussed as a part of this project.
TASK 1
P1: Management accounting systems
Management accounting is a tool which is used for the purpose of decision-making by the
management in a highly effective manner by the management (Management Accounting, 2020).
Its use can be made by Capital Joinery Ltd. so that it is able to ensure that its goals and
objectives can be attained highly effectively and efficiently.
Different types of systems can be used by the organizations in Management accounting.
These systems can be explained as follows-
Cost accounting system- In this system, the organizations are able to ensure that they
can calculate the various types of costs in a highly effective manner (Astami and et.al., 2017).
Thus this system is used for the purpose of identification of costs, their segregation and ensuring
that proper techniques can be applied for ensuring their reduction. Therefore the use of this
system can be made by Capital Joinery Ltd. This will ensure that they are able to achieve their
varied goals and objectives easily.
Essential requirements-
 In this system, there must be use of different methods so that the costs can be effectively
identified. Therefore in this manner this will help Capital Joinery Ltd. to be able to asses
costs effectively and efficiently.
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 This system has to ensure that the use of cost reduction techniques can be made so that
Capital Joinery Ltd. Is able to reduce the costs effectively and efficiently.
Inventory management system- In this system, the use of different methods and techniques is
made so that the level of inventory can be managed in the right manner (Dinh, Kang and
Schultze, 2016). Thus in this way, Capital Joinery Ltd. Is able to ensure that it can manage stock
in the right manner. Therefore this raises the overall level of efficiency and effectiveness in the
management of inventory.
Essential requirements-
 The use of this system ensures that the organizations are able to manage their level of
stock in a proper manner. Thus in this way Capital Joinery Ltd. is able to ensure that it
can manage inventory by making use of techniques like LIFO, FIFO, Weighted Average
Cost etc.
 In this system the use of certain types of techniques must be made which ensures that a
reduction in the level of overall costs related to the level of inventory can be made
effectively and efficiently. Therefore, In this way the management of Capital Joinery Ltd.
Will be able to reduce the maintenance costs effectively and efficiently.
Job costing system- In this system, the use of appropriate methods and techniques can be made
so that the management of the job orders can be done in the right manner effectively and
efficiently (Egan, 2018). Thus, In this way Capital Joinery Ltd. Can make sure that it can manage
its job orders in an appropriate manner.
Essential requirements-
 In this system, the use of right methods and techniques should be made so that the job
orders can be managed in the right manner. In this way, Capital Joinery Ltd. Can ensure
that the management of job orders can be done effectively and efficiently in an
appropriate way.
 This system has to ensure that the use of methods and techniques can be made for the
purpose of ensuring a reduction in the overall level of costs in the right manner. Thus in
this way Capital Joinery Ltd. Will be able to reduce its costs effectively and efficiently.
Price optimization system- This system ensures that the use of mathematical and statistical
models can be made so that the prices are set correctly for earning higher-level of profits
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