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Management Accounting System Concept

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Added on  2020-10-05

Management Accounting System Concept

   Added on 2020-10-05

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Management Accounting
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Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1 ...........................................................................................................................................1P1 Concept of management accounting and its essential requirement.......................................1P2 Different types of managerial reports and its importance......................................................3M1...............................................................................................................................................5D1................................................................................................................................................5TASK 2............................................................................................................................................5P3 Application of absorption and marginal costing method for preparation of incomestatement.....................................................................................................................................5M2...............................................................................................................................................8D2................................................................................................................................................8TASK 3............................................................................................................................................8P4 Advantages and disadvantages of different kind of budgets and their importance..............8M3.............................................................................................................................................10D3..............................................................................................................................................11TASK 4..........................................................................................................................................11P5 Application of management accounting system to overcome from financial issues...........11M4.............................................................................................................................................12CONCLUSION..............................................................................................................................12
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INTRODUCTIONManagement accounting is important profession which contributes in decision making,planning, monitoring, controlling of organisational functions. It is considered as process ofpreparing reports and accounts which provides timely and reliable information to the managersfor operation of day to day functions. In comparison to financial accounting, managementaccounting is broad concept which includes the provisions of costing also which helps to bringcoordination among the different departmental functions. It helps the management to attainflexibility in their structure and build effective strategies which helps in achievement oforganisational objectives. Tech(UK)Ltd. Produces special charger for retailers (Arroyo, 2012).In the present report explain about, difference between management and financialaccounting, importance of management accounting as decision making tool, differentmanagement accounting systems, different types of managerial accounting reports and itsimportance and use of absorption and marginal costing method for preparation of incomestatement. Also, advantages and disadvantages of different kind of budgets, budget preparationprocess, importance of budget and application of management accounting systems to respondfinancial issues.TASK 1 P1 Concept of management accounting and its essential requirementDistinguish between management and financial accountingManagement AccountingFinancial AccountingIncludes preparation of reports and accountsfor the benefit of internal parties to improvetheir decision-making and effectively manageday to day operations.Includes the preparation of annual accounts oforganisation for the use of externalstakeholders to improve their decision makingregarding make investments The information gathered from such reportsused for preparation of future strategiesThe information collected from these accountsused to for measurement of past performanceSuch reports are based on specific areasThese reports are based on the performance ofentire organisationHelps in measurement of operation andfinancial performanceOnly helps in measurement of financial data
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