Management Accounting Technique | Assignment

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Added on 2020-01-16

Management Accounting Technique | Assignment

Added on 2020-01-16

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MANAGEMENT ACCOUNTING

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................4TASK 1............................................................................................................................................4(P1) Explain the management accounting system and determine the importance ofintegration of these accounting systems in the organization?...................................................4(P2) Different methods and techniques of the management accounting reports......................5(M1) evaluation of benefit of management accounting system................................................5(D1) evaluation of management accounting system and management accounting reportintegration in the organization..................................................................................................6TASK 2............................................................................................................................................6(P3)(A) Statement showing the income based on the principle of marginal costing................6(P3)(B) Statement showing the income based on the principle of absorption costing.............7(M2) Use the appropriate tools and technique and produce the financial report documents...8(D2) Produce the financial report which apply and interpret the data for complex activities ofthe business...............................................................................................................................8TASK 3............................................................................................................................................8(P4) advantage and disadvantage of different kind of planning tool........................................8(P5) explanation about the effectiveness of the management accounting system and alsodetermine the comparison of them and about the prevention of financial problem.................9(M3) analysis the different planning tool and forecast the budget...........................................9(M4) explain how financial problem solving for leading the sustainable success of theorganization.............................................................................................................................10(D3) planning tool solve the financial problem of the organization.......................................10CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12

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INTRODUCTIONThis report provides knowledge of the tools and techniques of the organization so thatthey run their entity more profitably and effectively and achieve the long term desirable profits.Basically this report is on the small business managers and their effective decision afterconsidering these rules and guidelines for achieving the long term goals. This report provides theeffectively of the work in long run so that the organization achieve more profits and meet theirwants or needs. The tools and techniques are various types so that the organization must choosethe best alternative among them. Due to this the organization satisfies the needs and wants of thecustomers and enjoys the benefit of them. Importance of the various techniques also presented inthis report. This report describes the advantage and disadvantages of the methods or techniquesin the long run. TASK 1(P1) Explain the management accounting system and determine the importance of integration ofthese accounting systems in the organization?Accounting principle refers those rules and guidelines which is follows by theorganization to running their concern more effectively and efficiently. There are variousprinciples which are follows by the organization which are accounting assumptions, accountingconcepts, accounting constraint and accounting standards. Here, accounting assumption denotesthe money measurement and going concern of the entity which means the organization measurestheir amount of money through the specific unit. Another thing is going concern which states theentity never die in any kind of situations or the death of the partners company is run by theirnominee’s. Next principle of accounting is accounting concept, this refers that organization mustdisclose its full disclosure so that they take decisions effectively in the organization and the rulesfollows by the organization is dual aspect which means the organization must usage the doubleentry system for record of their transactions. They must usage the historical cost or the revenuerealization in their period. Furthermore, the next principle of accounting is accounting constraint which gives theconcept of materiality, prudence, consistency and cost benefit to the organization. Materialityconcept states that the organization must usage the standard measurement or statement torunning their concern more effectively and efficiently (Ax and Greve, 2017). This concept

Management Accounting Technique | Assignment_3

provides that if any change in the procedures of the accounting than this will be changeretrospectively. Prudence concept states that to record the assets and liabilities as soon as theyoccur and the last is cost benefit which denotes that the organization must evaluate their strengthand weakness so that they can reduce their cost and maximize the profits in the long run.Moreover, the last accounting principle is accounting standard which is issued by the country orthe regulatory body of the location of the organization is to be situated, for examples, FABC,IASB and FRC etc.Accounting system can be benefited for the organization making effective decisions as torun or providing the best operational strategies. It can be beneficial in various sectors like thedevelopment of internal management system, forecast for the future costs or expenses of theorganization. Favorable results can be obtained at measuring the cash flow, job performance ofthe employees in the organization, positive rate of return etc. These techniques can be fruitful inachieving the operational goals of the business entity and they can gather better goodwill andinvestments from the stakeholders which will reluctantly benefited in growth of firm.(P2) Different methods and techniques of the management accounting reportsTechniques and methods are the essential part to record the accounting and theydetermine the profit margin in between them. In present scenario, there are various methods andtechniques of accounting to meet the need of the organization (Messner and et.al., 2016). Thereis some modern and traditional method which gives proper influence to the organization.Traditional methods are such as, ranking method, paired comparison and graphic scale methodsetc. The ranking method denotes that to gives rank to the projects of the organization so that it ismore helpful while taking the decisions. Another is paired comparison method, this method ofaccounting reports denotes that provide comparison between 2 substitutes so that it provide helpin choosing the best alternative. Last in the traditional method is graphic scale method, whichpresents the best scenario in the perfect ways so that any employee of the organization can easilybe understood from this. Furthermore, the modern method of the accounting report which determine the cost andprofit of the organization in the modern way. Now every organization applies these methods intheir working, some methods of modern techniques are cost accounting method, 360-degreeappraisal and behavior anchoring rating scale etc. The cost accounting method refers that tocalculate the cost of the project of the organization by adding the direct & indirect expense so

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