Management Accounting and Budgetary Control in IKEA

Management
Accounting

Table of Contents
INTRODUCTION ..........................................................................................................................4
TASK ..............................................................................................................................................4
P1 and P2,M1(covered in ppt)................................................................................................4
P3. Computing costs through applying suitable methods of cost-analysis to formulate income
statements:..............................................................................................................................4
................................................................................................................................................7
................................................................................................................................................8
................................................................................................................................................8
................................................................................................................................................9
M2. Accurately apply the range of management accounting techniques and produce
appropriate financial report....................................................................................................9
. D2. Produce financial report which accurately apply and interpret the business activities 10
P4: Explaining major advantages & disadvantages of different types of planning tools used for
budgetary control:.................................................................................................................10
P5 Comparing as to how corporations are effectively adapting MA systems for responding to
multiple financial problems:.................................................................................................12
M4 Analysing about how as to respond financial problems, MA can lead entities towards
sustainable successes:...........................................................................................................13
D3 Evaluating as to how discussed planning tools can respond effectively to resolving such
financial problems to lead organisations to sustainable success:.........................................13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Managing accounting is that kind of process which makes identification, analysing,
evaluation and interpretation that expresses information to managers. This makes goals to be
achieved with objectives attain of an organization. Under it cost is also been referred that is used
for making accounting information attained at the time of decision making process in more
effectiveness. Managing of accounting is different from different methods of an organization.
This is there to provide a framework with detailed information that has been concerning with
financial and non-financial transactions. The assignment is based over IKEA organization which
is a multinational organization and has its headquarters in Netherlands. It was formed in the year
1943. Different variety of products is been sold by an organization related to furnished furniture,
kitchen appliances, household furniture and customizing furniture as per demand made by
customer. The report is based upon managerial accounting system which makes accounting
system of accounting managed. Further it deals upon approaches which are used for making
explanation developed. Along with this benefits and drawbacks in relation to planning
mechanism of budget control is discussed. In the end final cost is there for making determination
of correct method used with reading income statement through marginal and absorption method
told.
TASK
P1 and P2,M1(covered in ppt).
P3. Computing costs through applying suitable methods of cost-analysis to formulate income
statements:
Marginal costing this is that kind of method which makes contribution over assisting
costs which has been classified differently as costs and fixed cost.
Absorption Costing: In this type of cost product overhead is been fixed through helping
variable in relation to absorption fixed through making analysis over gross profit figure
developed for an organization.
Here is the calculation of net profit by using both marginal and absorption costing method:
Marginal costing: