Management Accounting of Nisa Retail Store | Report

   

Added on  2020-02-03

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ManagementAccounting
Management Accounting of Nisa Retail Store | Report_1
Table of ContentsINTRODUCTION........................................................................................................................................3TASK 1.........................................................................................................................................................3P1 Explanation of management accounting as well as essential requirements of varioussystems of it.............................................................................................................................................3P2 Explanation of different types of methods which are used in order to make managementaccounting report.....................................................................................................................................4TASK 2.........................................................................................................................................................5P3 Calculation of cost and net yield with the help of marginal absorption costingapproaches...............................................................................................................................................5TASK 3.........................................................................................................................................................8P4 Explaining uses of various kinds of planning tools along with merits and demerits ........................8TASK 4.......................................................................................................................................................11P5 Comparison between management accounting systems and there role in order torespond financial constraints.................................................................................................................11CONCLUSION..........................................................................................................................................12REFERENCES...........................................................................................................................................13
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INTRODUCTIONManagement accounting is an approach which give accounting information which isuseful to the management(Wajeetongratana, 2016). So that management accounting is a corefunction of any organisation. In this all the managerial decisions are taken such as policiesframing, deciding the techniques and using appropriate strategy, which are beneficial for thesuccess of business growth. In management accounting, company can identify, measures,prepare and monitor each and every financial tractions and elements related to theorganisation. In this way every organisation can use such kind of managerial activity becauseit helps the managers to effective allocation of resources and funds and make the firm morefinancially stable. In this case study, Nisa retail store is selected which operate there retailindustry in UK and it is also a small business enterprise. Nisa operates and provides thereproducts and services in local level such as in UK. This report explain the managementaccounting and there different management accounting system which are suitable to the Nisaretail stores. It also explain the different methods which are used for making effectivemanagement accounting reports. It also describes the different types of planning tools whichcan used in effective budgetary control.TASK 1P1 Explanation of management accounting as well as essential requirements of varioussystems of itManagement accounting is the process which help to record each and everytransaction which show the financial position of the organisation, it includes incomestatement, cash flow statements, balance sheet etc.(Vosselman, 2014). Managementaccounting provides all the sufficient information which provide clear, accurate and reliableinformation as per the time for the Nisa retailer stores. If the finance managers have accurateand reliable data or information they can make use such information for allocating theresources in a right manner so that organisation can achieve there major goals in future. Nisaretail stores is a small business enterprise which follow several kinds of systems andapproaches so that they can effectively allocate there resources, they are:Inventory Accounting- Inventory management is a process by which inventory or stockin an organisation can be managed effectively. By using such kind of approaches Nisa canmanage there stock and utilize it effectively for the production of there products and services.If there is higher level of stock in an organisation it means that workplace is not in a good
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condition, so that it is necessary to Nisa retailer to manage there stock effectively so that theycan enhance there profitability.ABC costing- It is a process in which expenses and cost are determined in each andevery stage, which are essential for the Nisa retailer to manage there cost and expenses andalso determined that such cost and expenses are effectively managed or not.Accounting for lean- This approach is based on such that in an organisation all wasteand unused expenses can be removed so that it can maintain the quality of services andproducts. As per in Nisa retailer,company can eliminate all the unused expenses so that it helpthem to make best quality of products and services. It is way by which management canreduce there cost which make no impact in production or called unproductive and which notgive any kind of return in such production.LIFO- It refers to last in first out rules, in this Nisa retail stores can sell all suchinventories which comes at the last time rather than using new level of stock. It is very rarelyused by the firm because this approach is less effective and does not give any kind of supportfor earning the profits.FIFO- It represent first in first out rule, in this stock and inventory are sold in firsttime when they comes into the business(Tappura, Sievänen, Heikkilä, Jussila and Nenonen,2015). It is considered as most usable approach which are adopted by every organisation. Ascomparing with the LIFO method, FIFO method is better and it gives actual or appropriatevalue of stock in Nisa retail stores.Weighted average- In this approach, stock are valued in every organisation as perthere average value. In this way weighted average method is used to determine the averagevalue of stock with the help of LIFO and FIFO. So that weighted average method helps theNisa retailer stores to examined there average value of stock which are required in thereoperational activity.Cost accounting system- It is a framework which is used by the firm so that managercan estimate the actual cost or cost per unit. It include profitability analysis, valuation ofinventory, cost control techniques, so that cost are managed by the manager effectively. Forexample: Nisa retail store manage their cost by using appropriate techniques and determinethe requirement of cost in each departments.Job costing system- It helps to identify and assign manufacturing costs to an individualproduct. This system are use when product are produced which are different with each other.
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