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Management Accounting Assignment - Ryanair

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Added on  2020-10-05

Management Accounting Assignment - Ryanair

   Added on 2020-10-05

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MANAGEMENTACCOUNTING
Management Accounting Assignment - Ryanair_1
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1 Definition of management accounting:.............................................................................1P2 Method used for management accounting reporting:........................................................3TASK 2............................................................................................................................................4P3 Analysing the costs per unit with the influences of marginal and absorption al costingtechniques...............................................................................................................................4TASK 3............................................................................................................................................6P4 Discussion the merits and demerits of planning tools and budgetary control techniques.6P5. To respond financial problems, organisation adapting management accounting system 7REFERENCES................................................................................................................................9
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INTRODUCTIONThe process of accounting all the transactional activities which held during the periodwill have positives reflection and outcomes in comparison with generating the satisfactoryoutcomes as well as managing the business operations. The records of all the entries andactivities helps managerial professionals in analysing the requirements of funds for theoperations as well as for forecasting the budgets in respective period. In the present report therewill be discussion based on various operational activities, management accounting system, toolsand reporting system which will be helpful to the aviation business of RYANAIR. Similarly,there will be ascertainment of effective costing technique with the help of analysing the costs onthe basis of marginal and absorption techniques. Additionally, there will be recommendationregarding management accounting tools that will enhance business performance and will help inresolving financial problems.TASK 1P1 Definition of management accounting:Management accounting is that branch of accounting which assist managers to makedecision, devise companies strategies, help in making planning, and policies for the organisation.They also provide required and necessary financial information to the managers as whenrequired.The scope of Management Accounting is wide, as it includes both Cost Accounting andFinancial Accounting in it, but it different in functioning as cost and financial accounting isgenerally done for the outsiders who are interested in the business but management accounting iscompletely used by internal management, moreover it is done regularly not as year end or at endof any financial accounting period. The methods for management accounting are; capitalbudgeting, ratio analysis, budgeting and working capital analysis, etc.Management accounting caters the internal needs of the business and work upon it, theinformation collected by the managers are used by the managers internally to improve theworking of the organisation, they help to make plans and policies for the organisation. It is anevolutionary subject and yet has scope of more to developed as profession so it is important tohave a detailed and proper knowledge of the subject as a whole.Essential requirement of different types of management accounting system:1
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The management accounting focuses on the proper functioning of the business so as thereare some management accounting system they are: (Fullerton, Kennedy, and Widener, 2013)Cost accounting system: It means to assist managers to control it cost of product oroperations in order to increase the profitability of the firm. The managers guides to takeup a best course of action in order to achieve the maximum result out of it. The Ryanairhas introduced Low Operation Cost, in regards to there customers, personal expenses,Aircraft equipment cost, which enables the company to earn more profit in low time. Inventory management: This means to properly handle the goods or inventory of thecompany from the manufacturing units to the point of it sales. The Ryanair has managethe inventory by introducing to purchase aircraft's from the same company so as it wouldbe easy to manage the handling of aircraft's and training and accommodating thereemployee.(Zoni, Dossi, and Morelli, 2012)Job costing system: It analyses the profit of the company by the revenues earned fromjobs. The Ryanair has able to earn from it reducing labour cost as the company tries tomaintain it's highly competitive workforce, by increasing there wages and benefitingthem with incentives.Price optimisation system: To adapt the best price for it products/ services which will besuitable for the company and the customer willingness to pay for it will help the companyto gain profits. The company has introduced fair prices for the business travellers and theconscious leisures so that get to travel on the plane this will bring profits to the pocket ofthe company (Ward, 2012).Users of Management Accounting Reports: mManagement accounting is used by managers, employees and staff menbers whowork in the Ryanair.Difference between financial and management accounting:BasisFinancial ManagementFinancial Management1.MeaningIt refers to the preparationof financial statement whichis used by outsider parties.It refers to the guiding ofmangers for decision-making,policy formulationfor the organisation.2.ScopeIt has narrow scope.The scope of management2
Management Accounting Assignment - Ryanair_4

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