Management Accounting for McDonalds
Added on 2020-02-05
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Management Accounting
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................4TASK 1............................................................................................................................................4Importance of management accounting.......................................................................................4Difference between management accounting and financial accounting......................................5TASK 2............................................................................................................................................5Evaluating classification of cost by function, behaviour, type and relevance.............................5TASK 3............................................................................................................................................7Explaining variance analysis and discussing common variances................................................7TASK 4............................................................................................................................................9Identifying different operational budgets.....................................................................................9Advantages of preparing different operational budgets.............................................................12CONCLUSION AND RECOMMEDATION ...............................................................................13REFERENCES..............................................................................................................................142
Index of TablesTable 1: Difference between management and financial accounting..............................................5Table 2: Sales budget.....................................................................................................................9Table 3: Production budget........................................................................................................10Table 4: Direct material usage budget.......................................................................................10Table 5: Direct labor budget..........................................................................................................10Table 6: Direct material purchase budget......................................................................................11Table 7: Fixed and variable o/h budget.........................................................................................11Table 8: Deprecation per quarter...................................................................................................123
INTRODUCTIONManagement accounting is the imperative field of managing business. It assists thecorporation to manage financial statements and determine long run growth in the marketplace.The present report is based on Mcdonalds which is a fast food outlet restaurant firm of the UKFurthermore, the report covers the importance of management accounting so the organisation canstay competitive in the marketplace. In addition to this, classification of costs has been evaluatedin accordance to the functions, types and behaviour of this cited firm. Moreover, differentbudgets and advantages of different operational financial plans have been explained.TASK 1Importance of management accountingFurthermore, importance of management accounting has been explained as follows-Cost analysis-The concept of management accounting enables Mcdonalds to assess thecost of products and services. Accordingly, they set margin of profit, by fixing sellingprices effectively. However, management takes into account the preferences of buyersand profile for particular segment for which product has been developed (Caliskan,2014).Measurement of performance-Management accounting consists of different aspects likebudgetary control, assessment of cost and variance management. These all parametersmake it possible to assess performance of Mcdonalds for particular time span.Increasing efficiency of business-Under management accounting, target is set for eachdepartment of Mcdonalds. Those targets serve as a basis of increasing efficiency oforganisational production and profits. This is because; targets provide informationregarding achievement of cash flow targets with respect to improvements required(Oliveira and et. al., 2010).Providing effective management control- With the help of management accounting,Mcdonalds plans, controls and coordinate among its different departments. Furthermore,variations are analyzed by considering the actual and expected performance. This leadsthe corporation to adopt effective techniques to control variation (Sandalgrh and Bukh,2014).4
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