Management Accounting: Methods, Tools, and Techniques

Management
Accounting

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
Part 1................................................................................................................................................1
Task 1...............................................................................................................................................1
P1. Discuss the Management Accounting System......................................................................1
P2. Different methods used for management accounting reporting............................................3
Task 2...............................................................................................................................................5
P3. Calculation of cost using different costing techniques..........................................................5
Task 3...............................................................................................................................................5
P4. Tools and budgetary control along with advantages and disadvantages...............................5
Task 4...............................................................................................................................................8
P5.Comparision on how the organization are adopting management accounting system...........8
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Management Accounting is the process of preparing reports about business operations
that helps managers make short-term and long-term decisions. It helps a business pursue its
having goals to identifying, measuring, analysing to communicates information to managers
(Allain, Lemaire and Lux, 2021). Strategic decision-making power through which organizations
can gain stability in market. It also assists the external stakeholder to be more effectively in
determining the actual financial status of an organization's efficiency. The primary aim of
preparing management accounting is that help to holding back to maintain structure of company.
The company is selected Capital Joinery Ltd is an medium sized standard enterprise where they
incline render better financial services as well as dealing with furniture goods better gaining of
competitive advantages against competitors (Alvarez, Bello and Vazquez, 2021). They
guarantees that their furniture must be trendy according to the current needs and requirements of
the customers.
As per the report, the important topics are following with discussion on the different types of
management accounting system, a variety of methods used in accounting reports and preparing
income statement by analysing the cost analysis with various types of cost. They are preparing of
income statement along with the merits and demerits, methods of planning tools that can be used
to control budgets, and comparison between the two organizations related to the financial
problems they are facing and solutions to them.
MAIN BODY.
Part 1
Task 1.
P1. Discuss the Management Accounting System
Financial Accounting: It is an effective reporting division that leads ti maintain leads for
business transciation in the organization (Balstad and Berg., 2020). It is depicted for suitable
paymemt reported and reflected quarterly to consider financial statements, including
income, balance sheets, etc.
Management Accounting: It is a type of methodology that managers use to measure
specific operation for the company. It tend to undertake effective collection of data from
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several department by effectively reviewing to undertake decision by managers. In the
perspective of Capital Joinery Ltd, several accounting systems have beenfital for managers
that create develop effective strategies considering to get success within prominent
activities.
Difference Between Management and Financial Accounting
Management Accounting Financial Accounting
It assists managers to make effective and
profitable decisions making for an
organization.
It provide information that is in monetary as
well as non monetary terms.
It helps management analyze the actual
financial position of an organization through
preparing within annual financial records.
It facilitates proper details of an organization
in terms of financial statement basis like
profit and loss, balance sheet etc.
There are various management accounting systems are as following below:
Cost Management System: According to this method effectively opted by the suppliers to
measure the suitable cost of the product within other concerning functions. For this, the
manager needs to decide the company's overall spending, which is useful for the effective
cost (Becker, Pedell and Pfaff., 2021). In relation to capital Joinery Ltd, their manager trends
to follows a suitable program that leads to offers with various benefits in terms of having an
effective company development strategy.
Inventory management system: This system depicts maintaining records of current level
of inventory with an organisation that helps meet customer needs and wants. In the
perspective of Capital Joinery Ltd is use to maintain better relationships with new clients
and reality loyalty of existing customers by maintaining with a better sufficient level pre
ordered product can be delivered on time without dealy in time. Furthermore, it consists of
different types, which include LIFO, FIFO and AVCO. The term LIFO means the received
inventory that used in manufacturing activities. FIFO means the product and services
purchased earlier will be used at first production house activities. About AVCO is referred at
an average cost which is distributed based on produced. The management team of Capital
Joinery Ltd is handling to collect important information about the inventories.
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