(PDF) Managerial Accounting Case
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Added on 2021-02-21
(PDF) Managerial Accounting Case
Added on 2021-02-21
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Managerial AccountingCase Study
INTRODUCTION...........................................................................................................................1PART 1............................................................................................................................................11. Explain the different type of cost.............................................................................................12. Best option to purchase the appliances by making sound decision.........................................23. Detailed calculation for each option........................................................................................34 Calculations in context to hire additional employees...............................................................45. Calculations which shows that how much employees are needed to be hire..........................5PART 2............................................................................................................................................61. Management accounting system in Canon and Apple computer.............................................62. Process of information creation and innovation contribution..................................................73. Specific outcomes or lessons from article research.................................................................8CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONManagement is the process of identifying, measuring interpreting and communicate theinformation with manage which further helps in continue their organizational goals & objectives.It include the various accounting information which help the manager to analyses their financialinformation which further helps the business maintain their records in presentable way (Cadez,and Guilding, 2012). As external as well as internal party can understand the information andmake their important decision according to it. Nanna's House chooses for the betterunderstanding of these concepts where it is founded by the Douglas and Pamela which is childcare business. This report includes the various topics such as different types of cost and requiredinformation for the purchase of appliances. Along with this, it includes the calculation about thecost of launder cloths and components of managerial accounting system which include thediscussion about efficiency or effectiveness. In addition, it includes the innovation process whichincludes the process of information creation. PART 11. Explain the different type of costCost refers to that amount which is occurring at the time of producing product or services.It is important for the organization to identify the cost of each unit which they produce and it willfurther help in setting their product cost. Lower the product cost will help to increase their profitmargin same as, higher cost of product reduce the margin of profit. Cost will be considered as aexpenses for the business. So it is important for the organization to minimise their product orservice cost. As per given case study, Douglas & Pamela decided to start child care businesswhich name has Nanna’s House. At the time of starting their business company face the differenttype of cost which is discussed below:Fixed cost: It is the cost which is not changed for the whole period of production eitherproduction unit is increased or not. Basically fixed cost will not changed it remain same for thelonger period (Chiarini, 2012). For the organization it is difficult to reduce their fixed expensessuch as rent, salary, any premium amount or other expenses. According to the case study,Douglas & Pamela have to bear different types of fixed cost in their business. Such as, companyhave to pay annual $ 3840 for the cost of insurance. Frank charge a fee of $ 800 per month foreach child and it is the fixed cost for the company. Because they have to pay fixed amount on1
every month because of that it will be the fixed cost for the company. Initially, business has topay the licence fee. Variable Cost: It is the cost which can vary as per the production volume changedbecause as the number of units increase then cost of variable cost also increased. So it is totallydepend upon the production. Organization can control their variable cost in order to reduce theiroverall cost which directly affects the business in terms of profitability as well as profitability.Variable cost include the direct labour, material, overheads cost etc. According to the given casestudy, variable cost of the business is food expenses, frank charges and it will depend upon theproduction. For example if number of children increased then cost automatically increased.Douglas & Pamela also provide the snakes and food for the children where they chargeadditional $ 3.20 per child. Semi Variable cost: It includes those cost, which include the features of variable or fixedcost. In the organization, cost will be fixed for the certain level after that it will be charges as perthe usages. If any organization not produce any single item or not provide any king of servicesthen they also have to bear fixed cost because it does not matter that either company producingsomething or not (Miller, Proctor and Fulton, 2013). As per this case study, variable cost of theappliance is $ 440 and delivery charges are semi variable because business provide the option forthe delivery. Semi variable cost can change as per the requirement which is totally depend uponthe demand & supply of products and services. 2. Best option to purchase the appliances by making sound decision It is very important for the every organization to take effective decision in order to increasetheir productivity or profitability. For the smooth functioning of their business functions andoperational activity company required to take effective or sound decisions which further helpsthe organization to increase their business goals & objectives (Manetti, 2014). Douglas &Pamela determine their financial performance which helps the business to identify their incomeor expenditure related to their business activities. Owner of the Nanna’s house wanted to makeeffective decision in order to increase their efficiency or effectiveness (Bhasin, 2013). Cost ofolder appliances is $ 440 and according to the given case study alternatives are available for thebusiness growth and purchase cost of the appliances is $ 878.72. Laundry from Red Oak Laundry & DryDetail$ 52 Per month.2
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