Various Methods of Management Accounting Reporting
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Added on 2020-01-23
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MANAGEMENT ACCOUNTING INTRODUCTION 1 TASK 11 P1 Management accounting and its various kind of management accounting system1 P2 Various methods of management accounting reporting 2 M1: Advantages of management accounting 4 D1: Critical evaluation of reporting system 4 TASK 24 P3 Who aspectal and Absorption costing and calculation of Income statement through these methods 4 M2: Evaluation of accounting techniques 6 D2: Critical evaluation of income statements 7 TASK 37 P4 Advantages and disadvantages of various kind of planning tools7 M3:
Various Methods of Management Accounting Reporting
Added on 2020-01-23
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Table of ContentsINTRODUCTION ..........................................................................................................................1TASK 1............................................................................................................................................1P1 Management accounting and its various kind of management accounting system ..............1P2 Various methods of management accounting reporting........................................................2M1: Advantages of management accounting..............................................................................4D1: Critical evaluation of reporting system................................................................................4TASK 2............................................................................................................................................4P3 Marginal and Absorption costing and calculation of Income statement through thesemethods.......................................................................................................................................4M2: Evaluation of accounting techniques...................................................................................6D2: Critical evaluation of income statements.............................................................................7TASK 3............................................................................................................................................7P4 Advantages and disadvantages of various kind of planning tools.........................................7M3: Evaluation of planning tools................................................................................................9D3: Critical analysis of financial problems.................................................................................9TASK 4............................................................................................................................................9P5 Two organisation are selecting management accounting systems ........................................9M4: Analysis of financial problems..........................................................................................12CONCLUSION ............................................................................................................................12REFERENCES..............................................................................................................................13.......................................................................................................................................................15
INTRODUCTION Management accounting is an effective process of recording, presenting, analysing andidentifying financial information or data. So in this business management can use it for thecontrol, decision making and planning of them. It is also define as an accounts and managementreport preparation tool that give correct statistical data needed by an administrators in order totake short term and day-to-day opinions (Bebbington and Thomson, 2013). It is very essentialaspect for the company because in this they can interpret and prepare all information that helpbusiness manager in particular judgement making within the better framework of achievingdesire goals and objectives of organisation. This report is based on Bizdaq, it was established in 2015 and have less than 50 workersin this enterprise. Annual turnover and sales of this company is £100,000. this assignmentdiscussed about meaning of management accounting and different types of its system. Variousaspects of management accounting reporting also shown in this study. Planning tools and itsadvantages and disadvantage are useful for the company to attain desire objective of them, it isdetermined in this project. This project also shown about Managerial and absorption costingmethod help the company to determine their annual sales and revenue in appropriate way. TASK 1P1 Management accounting and its various kind of management accounting system Management accounting: It is the process of measurement, identification, analysis,accumulation, communication, interpretation and preparation of information or data that supportemployer in particular judgement making within the effective framework of achievingorganisational objectives (Management accounting, 2018). Importance of management accounting: It is very important and essential for thecompany in order to analysis their annual sales or revenues (Caglio and Ditillo, 2012). With thehelp of this tool, company gain accurate and timely information in limited time period. All thosesignificance are describe under this: Qualitative information: It is one of the important part for the company because thisaspect provides accurate information to them. So in this they can do their all activitiesand function in a correct way. 1
Ongoing training and information: Accounting system is very useful and essential forthe administration of Bizdaq in order to achieve desire objective. It is important for thebusiness manager to give better training to their workers so they can understand regadinginnovatuive activities and policies. Types of management accounting system: There are different types of management accountingsystem which are determine under this: Cost accounting system: It is best and important kind of management accounting whichis used by Bizdaq in their business operation. With the use of this system, company can analysistheir product cost in an accurate manner (Chenhall and Smith, 2011). It support the organisationin order to evaluate cost of sales and decrease their extra wastage effectively. Price optimisation system: It is a mathematical tool which is used by organisation inorder to identify how clients will react to various prices for its services and products throughlarge number of channels. So it is very useful and beneficial aspect to identify the cost that thebusiness entity can meet their objectives and gaols such as increasing operating profit. Inventory management: It is essential system of management accounting which dealswith methodology, finished goods and raw material of company. It is required by each and everyorganisation to analysis number of orders, evaluate inventory level and sales of a product. It ismainly needed by manufacturing industry to control or monitor their production process foracquiring more profit from their specific resources. Job costing approach: This kind of tool is critically needed by a business entity, becauseit assist them in identifying manufacturing prices related to specific job. Who organisation has toselect this method that could evaluate the cost of specific job and maintain practicability ofbusiness information. P2 Various methods of management accounting reportingManagement accounting report: It is a beneficial and essential techniques that assistsorganisation through determine the practicality of functionality of the company. This toolprepare the business report about external and internal stakeholders (Christ and Burritt, 2013).This type of report provide accurate and timely financial data to managers in order to makeshort-term and day-to-day managerial judgement. There are different kind of managementaccounting methods which are determined under this: 2
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