Management Accounting - Nero Ltd Assignment

Management
Accounting

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Management accounting and essential needs of various kinds of management accounting
system..........................................................................................................................................1
P2. Several methods used for management accounting reporting..............................................4
TASK 2............................................................................................................................................5
P3.Calculation of cost using appropriate techniques of cost analysis:........................................5
As per absorption costing:...............................................................................................................8
TASK 3............................................................................................................................................8
P4. Advantage and disadvantage of planning tools in budgetary control:..................................8
TASK 4..........................................................................................................................................10
P5.Comparison of companies in resolving the financial issues:...............................................10
CONCLUSION..............................................................................................................................12
REFERENECES............................................................................................................................13
.......................................................................................................................................................13

INTRODUCTION
Management accounting is considered as the crucial business term which facilitates
internal information of the firm. This involves organisation's ability for giving a specific
liquidity, capability to accomplish obligation, business flexibility and so on. Moreover, this is the
procedures to prepare accounts and reports of management which facilitate relevant as well as
timely statistical and financial data to the managers (Brennan and Merkl-Davies, 2013). For this
report the chosen company is Nero Ltd. Which locally designed luxury products by Kenyans.
The purpose of this report is to describe the whole concepts of management accounting and
essential needs of several kinds of management accounting system. Various methods utilise for
management accounting reporting. Calculation of cost with the help of cost analysis techniques
as well as advantage and disadvantage of budgetary control planning tools. Apart from this,
ways through which firms are adopting system of management accounting for responding the
financial problems are also mentioned in this report.
TASK 1
P1. Management accounting and essential needs of various kinds of management accounting
system.
Management accounting is the process of presenting accounting information required
for managerial use for formulating policies adopted by the organization and to assist in day to
day and short-term decision making. This information helps Nero Ltd. managers to perform all
managerial function like planning, organising, staffing, directing and controlling. According to
Batty, Management accounting is considered as the term which is utilise to explain methods as
well as techniques of accounting that couple with essential capability and knowledge that aids
management with their work of enhancing profitability or reducing losses.
Management accounting system consists of internal systems that an organization uses
to measure and evaluate it's performance. The main objective of this particular system is provide
accurate information to managers so they can make sound decisions (Budding, Gross. and
Tagesson, 2014). So, Nero Ltd. Use management accounting system so that they can get relevant
data in order to develop effective decisions. It is the essential accounting tool for Nero Ltd. as
this involves both financial as well as non financial information which is helpful into business
management.
1