Modern Management Accounting Techniques

Added on - 22 Jul 2020

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Finance for Non FinancialManager
TABLE OF CONTENTSTASK 1..............................................................................................................................................3INTRODUCTION...............................................................................................................................3Explaining tools that used in short term decision-making....................................................3Critically evaluate modern management accounting techniques.........................................6Evaluating ratio analysis tool to evaluate performance........................................................8CONCLUSION..................................................................................................................................11TASK 2............................................................................................................................................12INTRODUCTION..............................................................................................................................12Critically evaluate the alternatives techniques of investment appraisal that can beundertaken by the firm.......................................................................................................12Determining the alternative methods of Investments Appraisal........................................15Evaluating risk management techniques.............................................................................16CONCLUSION..................................................................................................................................17REFERENCES...................................................................................................................................18
TASK 1INTRODUCTIONIn the present assessment there will be evaluation of the tools whichare beneficial in short term decision making. In order to achieve the bigorganizational targets there is need to evaluate the various short termrequirements of firm. It helps in making the adequate decision making aswell as helps in enhancing the profitability of the firm.Explaining tools that used in short term decision-making.Financial statements:The analysis were based on outcomes reflectin the income statements, balance sheet, cash flow statements and variousaccounts of the firm which in turn reflects the operational efficiency of thebusiness over the period as well as the necessary steps to be taken byorganization to enhance ability of the firm (Financial Tools for BetterCorporate Decision Making,2017).Advantages:It helps in presenting the adequate information which are relevant withthe transactions held during the period.Disadvantages:It only reflects that the transactions which are relevant with the onesingle period such as annual or monthly do not include all the periodsat the time of analyzing the statements.Forecasting and budgets:In terms with having the potential production outputs theforecasting and budgeting techniques will be helpful for managers or executive directors of theorganization in terms of estimating the cost requirements as well as making the adequateassumptions based on the product needs and wants (Karimi, Dastgir and Saleh, 2017).Advantages:
It helps the business in making the adequate business decision whichin turn facilitating the managers with the adequate estimations.Disadvantages:The estimations which are made by managers will not be able to fetchall the necessary information as well as fruitful or industry to attainsuch targets.Ratio analysis:It facilitates the in-depth research of the operationalactivities in the organization with the helps of various ratios which in turndetermining the strength and weaknesses of the business. Thus, suchanalysis can be based on liquidity ratios, profitability rations, efficiency ratiosetc (Ossimitz, Wieder and Chapman, 2016).Advantages:It will be beneficial in analyzing the growth, profitability as well as theliquidity of the firm as well as outlines the capacity of the business tomeet the requirements as well as to pay the debts on required time.Disadvantages:The analysis were based on the past or historical data set which arenot relevant with the current scenario of the business.Investment analysis:In order to gain the adequate funds for thebusiness operations there is need to make the adequate analysis n of thebusiness operations such as equity gathering, profitability and the level ofsales made the firm in such period (Maas, Schaltegger and Crutzen, 2016).Advantages:There will be measurement based on the profitable return gain byorganization over any investment as well as brings ability to managersin analyzing the outcomes must meet the costs which are spent insuch activities.Disadvantages:
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