Unit 5 Management Accounting: Principles, Techniques, and Financial Performance

Management
Accounting

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
Part A Management Accounting............................................................................................3
Part B Preparation of financial statements, including income statement...............................6
TASK 2............................................................................................................................................7
Part A Describe advantages and disadvantages of various types of planning tools tat are used
in budgetary control................................................................................................................7
Part B Adaptation of management accounting system in order to financial performance.....9
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
The below prepared report includes the importance of principles of management accounting
and fulfil the requirement of management accounting with the help of management
accounting tools or techniques. It include the roles and responsibilities of management
accounting system. There are various techniques of management accounting are discussed
below with its importances (Căpușneanu and et.al., 2020). This report also tells about the
merits and demerits of management accounting system and this will assist company to opt
best suitable management technique to deal with finance related issues. It work as a guide to
the company JM runs to provide best suitable alternative for smoothly running business
operations. According to the given case study financial statements of the company JM runs
are prepared which include income statement and also computed absorption and marginal
costing per units. Planning tools of budgetary controls are also discussed with its advantage
and disadvantages. Problems arising by the time of implementing management accounting
are also explained.
TASK 1
Part A Management Accounting
1. Brief discussion on the principles of management accounting.
Management accounting refers to the presentation of financial data of a company that
help internal management in order to make business decisions. Presentation of financial
information will future modified by the management to achieve particular objective of the
company (Dressler and Rachfall, 2020). Management accounting include several facts of
accounting that includes budgeting, forecasting and different financial analysis.
Principles of management accounting refers to the rules and regulation or necessary
guidelines that have to be followed by management while reporting the financial information.
These principles are helpful for the company to improve quality of financial information that is
prepared by managerial department. It bring effectiveness and efficiency in future plans and it is
essential for maximising future profits. Accounting principles are issued by the Financial
Accounting Standard Board and they have to strictly followed by all companies.
2. Roles and duties of managerial accounting and managerial accounting system.