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Assignment on Management Accounting of Nelson Hotel

   

Added on  2020-06-05

19 Pages3738 Words65 Views
MANAGEMENT ACCOUNTING1

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IntroductionThe process of management accounting enables an organization to prepare reports which givesaccurate and timely financial information to managers who are associated with short and longterm decisions. It also enables an organization to purse goal by measuring, communicating andanalyzing information (Agrawal and Cooper, 2017). Besides, organization carrying out propermanagement helps in building positive variances and handles negative ones. The assignment willbe carried out on two identical scenarios. The scenario 1 will be presenting a report to generalmanager from the management accounting officer. The other one will be presenting a report foranalyzing the issues that are related with accounting information function including budgetarycontrol and budgeting. TASK 1:LO1: To understand management accounting systemP1: Management accounting and different types of management accounting systemFrom: Management Accounting Officer,To: General Manager of Nelson Hotel,Sub: Management Accounting System.Introduction: The particular task will give an understanding of management accounting and itsimportance within an organization. The present assignment will be carried out by acting asManagement Accounting Officer who will be presenting a report to general management ofNelson Hotel UK a medium sized enterprise. The company is not having more than 50employees and the net turnover is not exceeding £500,000.Management Accounting System: Baker et al. (2017) defined management accounting as asystem that collects financial data from an organization including sales data, changes in cost ofraw materials and inventory in order to change the information to analyze a report. 3

Types of Management accounting system:Figure 1: Types of Management accounting system(Source: Self Created)Cost accounting system: This is also called product costing system which is used within businessenterprise for estimating cost of products in order to analyze organization profitability. Forexample, Nelson hotel need to know which services will help in earning more profit and whichare not and it can be done by estimating correct price of products. Kim et al. (2013) added thatcost allocation is a technique of cost accounting system that helps in incorporating departmentsand several services given by the hotel enterprise. For example, cost of furniture, food items andmany more. Besides, job order costing is another technique that takes cost of manufacturing foreach department of the organization. Such process is appropriate for the business enterprisewhich is associated with production of distinctive products. Hou et al. (2017) stated that, activitybased costing is associated with calculation of several activities that is carried out within anorganization. Inventory Management Systems: It is an ongoing progression used for planning and trackinginventory activities. The inventory items are always tagged with a bar code number to make itidentical from one another. In case of hospitality industry the same happens where the inventory4Managemenet Accounting SystemCost accounting systemInventory management systemPrice optimisation modelsJob costing systems

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