Management Accounting - Sample Assignment

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Management Accounting1ACTIVITY BASED ACCOUNTING FOR SONIC HEALTHCAREStudent by (Name)Professor’s (Name)CollegeCourseDate
Activity Based Costing2ACTIVITY BASED ACCOUNTING FOR SONIC HEALTHCAREExecutive SummaryThe Sonic Healthcare is one of the known healthcare centers that have acquired greatmedical excellence, not only in Australia but across the globe. The headquarters are locatedin Sydney, with around 26, 000 employees (Manleyet al., 2009). Notably, the companyspecializes in pathology, radiology as well as primary care. The success of the organizationcould be attributed to the belief that they ought to offer quality medical diagnostic services tothe medical practitioners. The leadership style, as well as the relationship between thestakeholders, has established a strong culture which has ensured that the objectives listed aremet (Tate et al., 2014).Notably, the organization has expanded to other places, for example,USA, Germany, Ireland and the United Kingdom among others. In all the regions, thecompany employs more than 500 specialist pathologists, radiologists as well as medicalscientists who are approved by the management. Even though the organization is leading,there is an ongoing investment, called ‘state-of-the-art' which is a medical technology thatcustomizes information systems so to meet the needs of the stakeholders to the organization.Ethical standards are highly needed in this process so that it does not incur losses or lead tounmet goals.
Activity Based Costing3Table of contentsExecutive summary.................................................................................3Introduction...........................................................................................4Explanation of the Activity Based Costing and it features.....................................5Explanation of how the ABC aligns with strategies of the organization.....................5Identification of the mission of Sonic Healthcare .................................6Objectives of Sonic Healthcare........................................................6Corporate strategies of Sonic Healthcare...............................................6Explanation of how the Activity-based costing could assist Sonic in achieving goals...7Recommendations for implementing of ABC to Sonic Healthcare.................. .......8Alternative management tool suitable for Sonic Healthcare.....................................9
Activity Based Costing4IntroductionAs stated above, Sonic Healthcare is diverse as it serves entire Australia and otherregions. On the other hand, the organization offers medical assistance, indicating that thecosts should be as low as possible, to assist the many patients that visit the place. More so,the organization trains health practitioners where the resources they need are purchased. Thisis to say that the commercial use should record and account forso as to implement their beliefof offering quality and affordable services. ASX lists Sonic Healthcare as the toporganization. Getting to the position is not as hard as maintaining, was the industry has stiffcompetition. One of how the organization could maintain the position is by becoming keenon finances and how they are used in delivering services to clients. The board of directors ofthe company has therefore asked for a report, regarding the Activity Based Costing (ABC).The model has been suggested, as the accounting methodology that would boost financialaccountability. The aim of the paper is, therefore, to define the model and describe itsfeatures. Afterward, the mission, objectives and corporate strategies for Sonic Healthcarewill be evaluated, and compared to the features of the model, to find out whether it is helpfulto the organization.Explanation of the Activity Based Costing and it featuresThe Activity Based Model is a costing methodology that assigns indirect costs togoods and services and identifies the cost of each activity that is involved in the productionprocess (Evans and Schlies2016). In short, the model allocates costs of each product that isused in the making process. The approach is most useful to the organizations that arecomplex, where the production process involves many procedures. Several features are
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