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Management Accounting on Jaguar Assignment

   

Added on  2021-02-19

20 Pages5102 Words136 Views
Finance
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ManagementAccounting
Management Accounting on Jaguar Assignment_1

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INTRODUCTIONManagement accounting is a technique which is used by managers of different businessentities in order to measure, monitor, analyse, plan and control all the activities so thatsustainable success can be acquired (Hilton and Platt, 2013). With the help of it members inmanagement teams form strategies decisions for the purpose of accomplishing all the tasks ontime and reach to predetermined goals of business. It is mainly conducted for internalstakeholders because it guides them to analyse performance of company and form strategicdecision for its betterment (Hopper and Bui, 2016). Main aim of this project is to developunderstanding of management accounting and its importance for success of business. Theenterprise which is selected for this report is Jaguar Land Rover. It is a British Multinationalentity in automotive sector. It was founded in year 2008 and its headquarter is in Whitley,Coventry, UK.This assignment covers various topics such as demonstration of management accountingsystems and methods of reporting, application of a range of it techniques for calculation of costand use of planning tools in budgetary control. It helps the manager to develop various strategyin order to maximise profit margin. In addition, different types of budget will helps inmaintaining their activities and try to follow in proper way. Along with this, comparison of theway in which organisations use it to respond financial problems is also covered under thisproject.ACTIVITY 1PART 1Management accounting systemManagement accounting:It can be defined as the process which helps managers todetermine, analyse, monitor, assess and control performance of the company so that higherprofits could be generated in future (Laudon and Laudon, 2015). With the help of it, internalstakeholders measure that company is performing well or not in order to form strategic decisionsfor future period. In Jaguar Land Rover management accounting is conducted by managers onregular basis so that actual status of business can be assessed. It also guides top level executivesto analyse that enterprise is able to generate targeted profits or not.Basically management1
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accounting used for the purpose of external analysis and it helps the stakeholders in theirdecision making process regarding future investment. Management accounting systems:Tools that are used to analyse actual status of thecompany are known as management accounting systems. It guides internal stakeholders todetermine profitability of organisation which can help to enhance performance of wholebusiness. In Jaguar Land Rover, managers use them to keep a track record of each and everyactivity of enterprise so that possibility of challenges which may take place in future can bereduced. Different systems that are used by managers in Jaguar Land Rover are as follows:Price optimisation system: This system is used by most of the companies to setappropriate price for their products so that large number of customers could be attracted towardsthe organisation (Lavia López and Hiebl, 2014). In Jaguar Land Rover it is used by top levelexecutives in order to meet the expectations of clients by setting best suitable prices for the carsthat are sold to them. With the help of it they also try to achieve the long term businessobjectives such profit and sales maximisation. It is essentially required for the entity because itcan help managers to determine response of customers on different prices that are set bycompany for its products.Cost accounting system: This is the system which is used by the company to record theamount which has been incurred in the process of manufacturing goods. With the help of itmanagers can determine cost of each and every unit which is produced by their company. InJaguar Land Rover it is used by management in order to measure the cost which is relateddifferent cars engineered by enterprise (Leitner, 2013). It also guides them to allocate funds to allthe departments according to their requirements. It is vital for managers of organisation to usethis system as it helps them to estimate actual cost of products and ability of business to generateprofits.Job order costing system: All the business entities perform different activities and joborder costing system is used to record all of them. With the help of it tasks could be segregatedaccording their status. In Jaguar Land Rover it is used by managers to keep a track record ofdifferent processes that are conducted according to specifications of different clients. It is veryimportant for the company because it can guide management to determine cost of each and everyjob separately (Maas, Schaltegger and Crutzen, 2016). With the help of it, managers can analyse2
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