Management Accounting: Cost Calculation, Techniques, and Financial Analysis

Management Accounting
PART 2

Table of Contents
INTRODUCTION.................................................................................................................................3
TASK 1.................................................................................................................................................3
1.1: Calculation of cost by using various methods.............................................................................3
1.2: Large range of management techniques......................................................................................5
1.3: Analysis of data collected from income statement......................................................................5
TASK 2.................................................................................................................................................5
2.1: Advantage and disadvantage of using planning tools.................................................................5
2.2: Analysis of the expenses for July and August.............................................................................6
2.3: Objective and cash budget..........................................................................................................7
TASK 3.................................................................................................................................................8
3.1: Use of accounting system to determine financial issues.............................................................8
3.2: Evaluating financial issues faced by UCK furniture...................................................................8
3.3: Analysis of planning tools that is used in management accounting............................................9
CONCLUSION.....................................................................................................................................9
REFERENCES....................................................................................................................................10

INTRODUCTION
Management is one of the valuable aspects for an organisation which is used by the
company to analyse their financial performance as well as growth opportunities in coming
period of time. In accordance to deal with all these issues managers are looking to use
effective accounting systems that are help them to summarise and record all their day to day
expenses or cost those are incurred during the time of production process (Amoako, 2013).
Apart from this, uses of costing methods that are help them to evaluate net profit for the
company. Along with that advantage and disadvantage of using planning tools that can help
in controlling budgets. Comparison with other organisation regarding adoption of accounting
system that can help them to resolve financial issues are covered under this report.
TASK 1
1.1: Calculation of cost by using various methods
Cost is said to be the value which is given for the purpose of getting something in
return. It is simply that are aspects which is considered while the production of products and
services within an organisation. A business would be raise as capital from different sources
such as equity and other crucial sources. The capital is more invested in different projects of
an organisation in accordance with producing sufficient amount of goods. Costing is said to
be systematic procedure of evaluating total cost of UKC furniture in investing over the
production process with the present cost of capital (Brewer, Sorensen and Stout, 2014). The
management of analysis is reliable with the amount to select the accurate option that would
be delivering more effective results for the company. Cost is either related directly or
indirectly with manufacturing process in more effective manner. There are various types of
costing that are related with UKC furniture business operations. Some of them are mentioned
below:
Absorption costing: It is said to that cost which is applicable over the period of time
in producing product for the company. It includes both variable as well as fixed cost because
of which they are known as full costing method. It has been seen that they are some many
benefits of using this costing. But at the same point of time, certain limitation of using this
cost is also affecting the net profitability position of the company (Absorption costing, 2018).
This seems to be not considered as that much effective for making crucial decision making.