Types of Management Accounting Systems - Report
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Added on 2020-07-23
Types of Management Accounting Systems - Report
Added on 2020-07-23
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MANAGEMENTACCOUNTING
Table of ContentsINTRODUCTION...........................................................................................................................1TASK...............................................................................................................................................1P1 Management accounting and different types of management accounting systems..........1P2 Various methods which help in accounting report............................................................3P3 Marginal cost and absorption cost.....................................................................................5P4 Advantages and Disadvantages of planning tool............................................................12P5 How company is opting management accounting system..............................................14CONCLUSION..............................................................................................................................17REFERENCES..............................................................................................................................18
INTRODUCTIONAccounting is simply managing, summarising and classification of financial transaction.Management is all transaction related to finance in organisation is known as managementaccounting (Ward, 2012). For all these process there is need of finance department as well asexpertise for overall transactions. It also helps company in taking effective decisions and also infinancial and non-financial transaction which help organisation in taking decision related toinvestment. Company also have to do market research for investment purpose so that they canget more and more profit from the amount invested. With the help of increasing technology thereare various software which help in easily recording transaction of enterprises. This assignment isbased on CARWOW it is a company who sells new cars and the same is a small scale business.The same report explains management accounting and its requirement in company or variousmethods used in the same are also described. Instead of this income statement is prepared byusing absorption and marginal cost. Apart from this it also through light on advantages anddisadvantages planning tools used for budgetary control. In the end, it explains how anorganisation have to adopt management accounting system so that they can meet their day to dayfinancial transactions easily.TASKP1 Management accounting and different types of management accounting systemsManagement accounting is also known as managerial accounting or cost accounting.Managerial accounting is a process of report of management and accounts for giving important,timely and accurate management information which help in making decisions. Reports aremainly show an available cash amount, in hand order amount, account receivable and accountspayable, debts outstanding, inventory and raw materials (Vasile and Man, 2012). It also containsanalysis of variance and other statistics. Cost accounting main aim for mangers to help withinmaking decisions of a company. It is an important tool of making decisions within anorganisation by a management. It is tool for gaining planning better and control over a company.It is for all type of companies such as sole proprietor, non-for-profit companies or governments.Companies accounting is done on monthly and weekly basis. It is useful for external and internaluses of a company. External users are debtors, shareholder, investors etc. and internal users arepurchases, suppliers, employees etc.1
Cost accounting is a process which help in analysing of business cost and operations forpreparing internal report of finance, records day to day transactions and help managers in makinga decisions of accounts for goals achieving of a company. Managerial accounting is a decisionmaking of a mangers information’s and provision of financial (Vasile and Man, 2012).Accountants of management arrange an event finance and watch all happen activitiesaround organisation while looking the organisation needs. Emerge data is estimated. Datatranslation and knowledge is estimated which guide in making decisions. Formulating ofmanagement of controlling assist and strategy implementing in a company which includespartnering of management in decision making and performance of a management systems. Someof important requirements having various types of cost accounting systems are discussed below:Inventory management systems: It help in goods tracking from whole supply chain andbetween all movements of goods and parts between. Firms see every single and smallmovements of parts and goods and its operations it helps in taking investments and itsdecisions. Inventory of various managers focus on various parts of chain supply withsmalls firms because they are much interested in order and supply chain ends as having abroad scope in management of inventory costs are also broader. Management ofinventory help in inventory control and wastage of stock should be eliminated. It willhelp in balance maintaining between closing and opening stock or it can manage thesupply and demand of stocks with the help of management inventory.Job costing systems: It accumulates accounting of cost manufacturing separately fromevery job. Organisation appropriate is doing of production of unique products andspecial orders. It is understandable that analysis of job costing systems cost as perperformance and functions. Example of a costing systems that it is an appropriateaccounting of management of a organisation event such as producing niche furniture,producing cost are so high of air surveillance etc. costing of job tracks the cost andrevenues by job and reporting standardized enables job profitability (Van der Stede,2011). Systems of accounting give support to job costing, allow assigning of numbers ofjob to single items of expenses and revenue. Price optimisation systems: Optimization of pricewhich is used for mathematicallyanalysis by company. As per behave of customers to various cost of products andservices through the various channels. It helps in determining of the cost of a company2
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