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Management Accounting Systems and Techniques Assignment - Solved

   

Added on  2020-10-05

19 Pages5663 Words271 Views
MANAGEMENT ACCOUNTING
Management Accounting Systems and Techniques Assignment - Solved_1
Table of ContentsINTRODUCTION...........................................................................................................................1LO1..................................................................................................................................................1P1 Meaning of management accounting and essential requirements of different managementaccounting systems......................................................................................................................1P2 Different methods used for management accounting reporting in Big Yellow.....................4LO 2 ................................................................................................................................................6P 3 cost techniques and income statement..................................................................................6LO 3.................................................................................................................................................7P 4 advantage and disadvantage of budgetary planning tools.....................................................7LO 4...............................................................................................................................................11P5 Comparing how the Big Yellow adapting accounting management in respond to financialproblems....................................................................................................................................11CONCLUSION..............................................................................................................................13REFERENCES..............................................................................................................................15
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INTRODUCTIONManagement accounting means assembling all the accounting information to put up thefinancial reports of the company for making better decisions and formulate strategies andpolicies accordingly. This management is concerned with conversion of quantitate data likeestimated costs into meaningful information to be used by management of the company. Thisproject report will cover Big Yellow, a self storage company which provides space like rooms,containers, lockers to the people on rent for short period. The taken company is a public limitedlisted on LSE and FTSE 250 Index which was founded in 1998. It is headquartered in Bagshot,Surrey, UK. The company is one of the largest self storage firm in UK and is currently having 92stores in the country. Big Yellow enjoys the tremendous brand image in this industry(Abdel-Maksoud, Cheffi and Ghoudi, 2016). The assignment will lay its emphasis on different techniques of management accountingsystems and different methods of reporting. It will also include different techniques ofcalculating the costs' analysis. The reports will show the advantages and disadvantages ofplanning tools in budgetary control and how Big Yellow will adapt the management accountingsystems to cope up with the different financial problems.LO1P1 Meaning of management accounting and essential requirements of different managementaccounting systemsBig Yellow, a self storage firm which provides spaces, storing places, rooms to the tenants forbusiness and personal purposes. It has ninety-seven storage places in London and UK. Thecompany employs various accounting systems such as cost accounting system, inventorymanagement system etc., for efficient management accounting in the firm.Management accounting is concerned with providing all the useful information in theform of financial reports by converting the cost related data into organised information forassisting the management of Big Yellow in the decision making process. It is also known asmanagerial accounting. Managerial accounting helps the managers of Big Yellow to exercise allthe management functions which are planning, organising, monitoring and controlling. Theassistant management accountant of the company often faces issues in managerial accountingsuch as forecasting, Inventory valuation, capital budgeting(Szychta and Dobroszek, 2016.).1
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Management accounting system requires various components for being effective andefficient in the organisation which are given below:Inventory Management system: Inventory management is an essential requirement in BigYellow's accounting system. Inventory Management is related to managing all the raw materials,work in progress and finished goods, stores and spares of the organisation. It monitors andcontrols the flow of goods of the organisation from company's storage place to production areaand lastly to the stage of sale.There are different inventory control methods used for the management of the inventory in thecompany which are given below:Perpetual control inventory system: in which the inventory is checked on daily basis.Periodic inventory control system : in which the inventory level is examine after periodicintervals like 1 week, 1 month.Barcode inventory system: in this the inventory items are scanned through bar codescanner.Radio frequency identification inventory system : in this the inventory is tracked throughradio frequency waves and a reading machine. This management is necessary in Big Yellow because of the following benefits :It ensures the continuous of flow of goods to the production department by analysing thedepartment's daily requirements of raw materials and ordering the same at the appropriatetime.It helps in eliminating unnecessary cost of handling stores and spares of the company byefficiently managing them.It keeps the inventory in balance by determining the exact need of the unit and how muchhas to be ordered and at what time which results in the adequate inventory at all times butno excess inventory which locks the fund(Fourie and et.al, 2015).Inventory management helps in faster removal of the products from the warehouse bycritically examining the selling turnover in a year and accordingly taking decisions.2
Management Accounting Systems and Techniques Assignment - Solved_4

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