Management Accounting: Monthly Report Evaluation and Online Store Decision

Management Accounting

Contents
INTRODUCTION...........................................................................................................................1
PART A...........................................................................................................................................1
A) monthly report evaluation that present the flexible and original budget variances................1
B) computation of the financial year performance of the business by using monthly control
report that are mentioned above:..................................................................................................3
C) There are some recommendation that are given to the manager of the Amana Ltd.for
improving the path.......................................................................................................................4
PART B............................................................................................................................................5
Examination of the decision of the Mr Amana Ltd. Regarding open a online store and
eloborate the settlement of online merchandise with Amazon by observing the total cost.........5
CONCLUSION ...............................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
A budget refers to an idea that states the level of the earnings of human beings as well as
the corporation. It helps to evaluate the requirement of the money that will needed to the
organization. It is the process of examine the capabilities of the business firm to expend the
money in a particular time that has set up by the organization. Budget has been utilized for
predicting the position of the financial of the business as well as results for further time period. It
aids in analysing and planning the action or performance of the company that can involve
expending the fixed assets, furnishing the training to the workers, setting up the plan that are
related to the bonus and so on (Agyekum and Singh, 2018). The budget can be created on the
basis of requirements of the company such as monthly, quarterly, half yearly and so on. It is very
crucial part to preparing a budget before putting the action into plan of the project. It comprises
the revenue and expenses list. This process aids to earn the profits and control the over
expenditures as well. In this report, the examination or discussion states the statement that create
on the base of the month and make or prepare the budget of Amana Ltd. that are estimated and
evaluate the variances as well as differences. The examination of their action or performance has
been done at the time of pandemic.
PART A
A) monthly report evaluation that present the flexible and original budget variances.
Monthly control report: It helps to provide the important and crucial data that contains the
various cost of direct and indirect such as wages, overheads, expenditures and salaries. With the
help of this report, the owner of the business evaluate the action or operation activities cost that
has expended for selecting the alternative that how to decline the activity cost. It aids to furnish
the internally data of the business entity that relates with the upcoming income or that have
possibility to arise in future (Atkinson and et al., 2019). These income or earnings occur in
future in particular time period. It shows the differences between the predicted and actual. It
assists to organization to take the appropriate decision in order to reducing the variances.
Original budget: This budget has been already prepared. It is depended on the past information
that occurred the value and production level in last time. The manager of the business
contemplated it as very simplest way to analyse the performance of the corporation of upcoming
year's budget. It assists to evaluate the flow of income or earnings in future of the organization.
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It presents the difference among the fixed budget that can not be flexible and the real budget for
knowing the status of the income and expenditures of the business firm.
Flexible budget: This budget is required for adjusting the changes in level of actual revenue. It
utilized in measuring that come into this budget after completing the financial budget. It aids to
concentrated on specific cost that can be raised in the business enterprise. It is used to do some
modification or changes in same level of the income (Austin and Ejike, 2019). It has been set up
for deciding the constant cost and variable as per the action or practices. The flexible budget is
separated in two part variable and semi variable as well. Variable cost are those that fluctuate
according to the units and semi variable are those cost that have some fixed part and some
variable.
Budget variance: It refers to the difference that has been shown in estimated and real budget.
These factors assists to examine and analyse the information that is used by the corporation to
figure out the value of predicted and real (Baard and Dumay, 2020). If the output or outcomes
receives favourable then it shows the highest profit level of the company and if it comes
unfavourable then it states the negative impact of the organization. It is an accounting or
bookkeeping term which aids to observe the actual cost position that mean if the real cost is
reduced or risen than standard.
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