(solved) Management Accounting System PDF

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ManagementAccounting
Table of ContentsINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................3P1. Management accounting and different types of management accounting system...........3P2. Explain different methods used for management accounting reporting..........................5M1. Benefits of managements accounting system.................................................................6D1. Evaluate the management accounting system and management accounting report........7TASK 2............................................................................................................................................7P3. Different types of costing methods which are used in calculation of net profit...............7t...............................................................................................................................................9M2.Range of Management account techniques......................................................................9D2. Evaluate financial reports helps in business activities...................................................10TASK 3..........................................................................................................................................10P4 The advantages and disadvantages of different types of planning tools used for budgetarycontrol...................................................................................................................................10M3 The use of different planning tools and their application for preparing and forecastingbudgets..................................................................................................................................12D3 Evaluate how planning tools for accounting respond appropriately to solving financialproblems to lead organisations to sustainable success.........................................................12TASK 4..........................................................................................................................................13P5 Compare how organisations are adapting management accounting systems to respond tofinancial problems................................................................................................................13M4.Analye how management accounting can solve financial problems.............................15CONCLUSION..............................................................................................................................15REFERENCES..............................................................................................................................16
INTRODUCTIONManagement accounting is a technique which is used by the management in itsorganisation so that it can know the financial and managerial information of its business. Itprovide helps to the managers so that they can take important decisions in their company. In thisreport chosen company is Airdri Group. It is a retailing organisation which deals in various typeshand dryer products and it is established in United Kingdom. The aim of company is to identifyand solve financial problems through management accounting system. This report has discussabout the various topics like: management accounting report, system and methods andappropriate techniques of cost analysis and planning tools of management accounting. Apartfrom this it also talks about the management accounting system to respond the financialproblems.TASK 1.P1. Management accounting and different types of management accounting systemManagement accounting is tool which is used to evaluate the business activities. Thereare basically two types of accounting such as management accounting and financial accounting.It provides help to the management so that it can makes effective plans so that organisation runits business successfully (Management accounting. 2018).It helps to prepare managementreports which gives true and reliable information and data which is essential to take decisions onregular basis. By using it organisation can know its financial position. It is a process ofanalysing, summarizing, gathering and communicating information to the management ofcompany so that its accomplish its objectives. Airdri Group can apply it so that it can minimizesor solves the financial problems as a result it can maximization its revenue. Organisation can usedifferent types of management accounting system which are described as below:Cost accounting system:Cost accounting system can be used by the management to ascertain the cost of itsproducts and services and it is also knows as product costing system. Analysis of cost can helpthe company in profitability analysis and cost control. Management accounting officer can helpAirdri Group to ascertain the cost involvement in the production of goods. It helps theorganisation to minimise the cost so that profit margin can be enhanced. There are basically twotypes of cost accounting system which are as follows:
Job order costing:Job order costing is a technique which is used by the organisations to ascertain the cost ofmanufacturing of an individual batch or a product. This system can be used by the companywhen it manufacture various types of goods which are different from each other. It can be usedby Airdri Group to analyse the cost involvement in direct labour, direct material or overheads.Process costing:Process costing is used in production or manufacturing industry where companydifferentiate their processes and produce a standard product then it can apply process costingsystem to ascertain the cost of production. It can be evaluated by allocating all process cost to thetotal units produced. Airdri Group can use this method because it deals in various types ofproducts and services so that they can analyse the process cost of its units which aremanufactured by them (Banerjee, 2012).Inventory management system:Inventory can be in form of goods or material which can be finished product or rawmaterial. It is hold by the organisation for the ultimate objective of resale. Airdri Group canapply this system in its company so that is can effectively manage the stock of its business. Thereare various software or applications which can be used by the management to manage theinventory. This system can control the incoming and outgoing inventory so the company canascertain the present stock in the warehouse.Price optimizing system:This system is used to ascertain the accurate price of the products and services. It isessential for an organisation to decide the appropriate price so that more number of consumersshow their interest to buy the goods of company. Airdri GroupLtd should use this system so thatis can determine the appropriate prices of its different products and services and it can help theorganisation to maximize the sales. So it can generates the more revenue. Consumers are priceconscious so it is important for it to decide the reasonable price so that maximum customer canattract towards the company and show their willingness to purchase the products.Job costing system:This system includes the process of combined information about the cost associated witha particular service job or production. It reflects that an organisation is able to ascertain the
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