logo

Accounting of Management System

20 Pages5050 Words187 Views
   

Added on  2020-01-23

About This Document

Management Accounting INTRODUCTION 1 TASK 11 1.11 1.22 TASK 23 2.1 Calculation of net profit using absorption costing and marginal costing techniques 3 TASK 38 3.18 3.211 CONCLUSION 13 INTRODUCTION Management system is a process through which cited entity can reports of management and financial statementswhichprovidesadetailed description of the financial position of cited entity which is required by the stakeholders of cited entity. Management accounting combines various aspects of a business enterprise like finance, accounting and management so that better strategies

Accounting of Management System

   Added on 2020-01-23

ShareRelated Documents
ManagementAccounting
Accounting of Management System_1
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1 ..........................................................................................................................................11.2 ..........................................................................................................................................2TASK 2............................................................................................................................................32.1 Calculation of net profit using absorption costing and marginal costing techniques.......3TASK 3 ...........................................................................................................................................83.1 ..........................................................................................................................................83.2 ........................................................................................................................................11CONCLUSION..............................................................................................................................13
Accounting of Management System_2
INTRODUCTIONManagement system is a process through which cited entity can reports of managementand financial statements which provides a detailed description of the financial position of citedentity which is required by the stakeholders of cited entity. All the material information that isnecessary for stakeholders which can affect their decisions regarding a business organisation areincluded in those financial statements. Reports which are prepared as per managementaccounting shows amount which is available with the cited entity as well as revenue generatedout of sales. Further, these reports also give a detailed information regarding account payablesand account receivables(Christ and Burritt, 2013). In this report, a detailed description on theworking of accounting will be done along with the need of various systems is done. Thisdocument is based on the case study of Austin Fraser which is a recruitment consultant that dealsin engineering, information technology and sectors related to life sciences sectors. Through thisreport, management accounting methods and income statements using techniques of costaccounting such as marginal and absorption costing will be discussed.TASK 11.1 Management accounting: It is refers to be the process of identifying, measuring,summarising and analysing the various financial transaction which are done by the companyduring the year. It is based on display of professional skills and ability which is required tomanage accounting information.Importance of MA:It is use to avoid seasonal fluctuations.It also help in ascertainment of cost.Management accounting helps to determine unprofitable activities.Administration system is a process through which several reports have been prepared sothat management of cited entity can make suitable decisions regarding various financial and non-financial factors. Absorption and marginal costing are some tools or techniques of costaccounting through which cited entity can prepare better strategies for maintaining itsproductivity. Management accounting combines various aspects of a business enterprise likefinance, accounting and management so that better strategies can be planned or framed and valueof cited entity could be increased (Cinquini and Tenucci, 2010). Management accounting does1
Accounting of Management System_3
research over financial and non-financial data so that cited entity can achieve sustainabledevelopment. Unlike a normal accountant who deals in figures to report his financial statements,a management accountant frames business strategies for the development of cited entity andmonitors risk which is involved in operational management.Primary need of various variety of management accounting: There are certainnecessary needs for which various kind of management accounting are to be managed. Theseessential needs of requirements are mentioned as below: Traditional Management Accounting: It focuses on cost by the means of job order ormethods of process costing. Through these methods, Austin Fraser can allocate differenttypes of costs related with direct material, direct labour and manufacturing overheads. Requirements for Traditional Management Accounting: Generally, job order costingtechnique is used in manufacturing industry which has large projects as in such case,various types of costs are easily traceable and further, cited entity can easily allocatethem to respective project. On the other hand, process costing techniques allocate cost tovarious processes which produces homogeneous goods. Lean Accounting: It is a newly emerged technique of management accounting. Leanaccounting is really revolutionary because it does not only concentrated over cost, butalso it supports strategy making to reduce or control the cost by management of waste. Requirements for Lean Accounting: Through lean accounting, management accountantcan make strategies regarding cost reduction and he can implement such strategies for thebenefit of Austin Fraser. Through the same, managerial personnel can take requireddecisions.Different types of costing system:1.Inventory management system – Keeping in mind the end goal to complete the production procedure stock is required in an association. For this it is extremely pivotal that administration of same is done in such a way, to the point that viable utilization of stock is done as such that yield can be expanded which is done trough this system. 2.Job costing framework – To give the final products different employments are performedin an association. Keeping in mind the end goal to quantify the execution of each occupation it is essential that assessment of each is done independently with the goal that likewise results can be learn.2
Accounting of Management System_4

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Methods of Management Accounting Report
|20
|5645
|343

Adaptation of Management Accounting System to Solve Financier
|17
|5064
|187

TASK 11 P1 & M1 Introduction to Management Accounting INTRODUCTION
|16
|5556
|267

Management Accounting on Austin Company Assignment
|16
|4178
|191

Types of Management Accounting with Benefits and Limitations : Report
|25
|6101
|168

Management Accounting System Using Absorption Costing
|13
|3516
|482