Management Accounting Principles and Techniques

Management
Accounting Principles
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK ONE......................................................................................................................................3
PART -A..........................................................................................................................................3
Explanation associated with the principles of management accounting.....................................3
Evaluating the use of techniques as well as methods used in management accounting..............4
Evaluation of the way management account is integrated within organisation...........................5
PART-B...........................................................................................................................................6
Application of different cost analysis techniques........................................................................6
TASK TWO.....................................................................................................................................7
PART -A..........................................................................................................................................7
Comparison and contrast between different types of planning tool used for budgetary control
with their respective advantages and disadvantages....................................................................7
PART -B..........................................................................................................................................9
The way different organisation are adapting management accounting system in response to
financial problem.........................................................................................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
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INTRODUCTION
Management accounting is considered to be as the key process which is useful in
preparing the reports associated with the business (Borker, 2016). It is considered to be
prominent for the managers of the company to take long term as well as short term decision
making. This study will focus on developing understanding on the principles of management
accounting. Furthermore, the study also demonstrates the use of techniques and methods used in
management accounting. This study also calculates the cost to use appropriate techniques linked
with the cost analysis by the use of aboriginal and marginal cost. Also, the present study also
determine the advantages and disadvantages of the different planning tools which has been used
within the budgetary control. Lastly, the report will compare and also evaluate ways through
which the management accounting responds to the key financial problems.
TASK ONE
PART -A
Explanation associated with the principles of management accounting.
Management accounting is a key process which is useful in preparing the reports
associated with the business. It is relevant to measure, interpret and analyse the relevant
information to the managers. It is prominent for the managers of the company to take long term
as well as short term decision making. The key principles linked with the management
accounting is considered to be prominent in improving the business functions and helps in taking
prominent set of decision and improve the business results and outcomes.
Influence: The key significant principle linked with the management accounting is that,
it mainly focuses on effectively communicating the key relevant information. It is useful to
effectively strengthen the key process of the decision making (Borker, 2016). The access to the
information must be only with the key relevant professionals within the company.
Relevance: This is another prominent principle which states that the information is
considered to be highly valuable and is considered to be highly useful in the better decision
making. It is relevant to effectively interpret the financial as well as the non- financial details in a
significant and prominent manner.
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Value: This is another prominent principle which helps in estimating the value of the
business and also determines the business operations in an accurate and relevant manner
(Abdusalomova, 2020).
Credibility: This principle tends to effectively demonstrate that, stewardship tends to
form credibility. Scrutiny as well as the credibility is prominent for the better decision making. It
is considered to be useful for the near term interest and must ensure business operations are
carried out in an ethical and reliable manner.
Determining the role of management accounting as well as the management accounting
systems.
The key significant role of the management accounting is that it is useful in the better
decision making activities. It is prominent to effectively determine the existing set of expenses
and is considered to be relevant for the evidence based decision in a significant and reliable
manner. It is considered to be highly significant in analysing the budget and suggesting the
funding and allocation. Management accounting system is relevant to effectively evaluate the
process for the management of internal process within the company (Oyewo, 2020). The key
benefit of the management accounting system is that, it must focus on effectively planning as
well as controlling the key operations of the business in a significant and relevant manner. It is
considered to be relevant in improving the business operations with high degree of accuracy and
key relevance.
Evaluating the use of techniques as well as methods used in management accounting.
Management accounting system is useful in effectively planning as well as controlling
the key operations of the business. It is useful in taking internal decision of the company and
leads to better decision making and improved business operations.
 Cost accounting system: This is the significant framework which has been used by the
company to effectively evaluate and also estimate the cost of the products which is useful
for the analysis of the profitability. It is useful for the disclosure of the unprofitable and
profitable set of activities (Lebedev, 2019). It is significant for the periodical
determination of the profit and losses of the company.
Benefits of Cost accounting system
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