Management Accounting: Cost Analysis, Budgeting, Pricing, and Financial Problem Identification

Management Accounting

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Covered in PPT.......................................................................................................................1
TASK 2............................................................................................................................................1
Microeconomic Techniques...................................................................................................1
TASK 3............................................................................................................................................6
Using budgets for planning and control.................................................................................6
Pricing.....................................................................................................................................8
Strategic planning...................................................................................................................9
TASK 4..........................................................................................................................................10
Identifying financial problem...............................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
Management accounting is the presentation of system information in order to execute the
strategies to be selected by the administration and assistance its day to day activities. It supports
the management to formulate all the action like planning, organising, staffing, directing and
controlling (Culasso and et.al., 2016). To follow these activities by business and collect all the
relevant information and present in front of top authority to take right decision on time. To better
understand of the conception of MA chosen structure Prime Furniture which is a growing East
London based organisation. The company is planning to start training course for new interns in
November. For this prepare as report in which contains of accounting system with benefits,
different in financial and management accounting. Along with understand different reports,
range of accounting techniques in which contains cost, volume profit, cost variance, flexible
budgeting, different types of costing and many others. In addition, produce a budget with
alternative methods and compare to respond to financial problems.
TASK 1
Covered in PPT
TASK 2
Microeconomic Techniques
Cost: It is an expending required to make or exchange commodity or acquire an asset
prompt for average activity. It consist of all cost that is required for business entity. It has been
categorised into two manner like: Direct cost: These types of cost directly link with the development of buildings that are
called as direct cost. Such as, depreciation, insurance etc.
 Indirect cost: Those expenditure which are not direct connected with the construction
activities are define as the indirect cost. It consist of wages, agency substitute etc.
Cost analysis: It is outlined as comparison between actual and standard cost with the
reason of reporting and discovering all the costs with the improvement (Damayanti and Pentiana,
2018).
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Cost volume profit: It is a method of cost accounting that influence on the different
levels of costs as well as volume have an operating profit. Thus, it supports to carry out the
relationship among revenue and cost.
Flexible budgeting: It is a budgeting method that mainly applied in the budgets for
applicable modification and adjustments could be done as per the changes in organisation
operation. This method applied by the Prime furniture to analysing of varying volume as well as
cost (Datar and Rajan, 2018).
Cost Variance: This tool is utilised in business in order to evaluation of actual or
standard budget with value of building. It is mainly applied by Prime furniture to apply strategic
decision effectively.
Marginal costing: This is a kind of costing technique that is determined of marginal cost
and impact on changeable profitability. Marginal costing is helping to separate between non-
moving and changeable cost. In the context of Prime furniture manager use this method to
calculate net profit for the year in reference to each and every unit.
Calculation of profit using marginal costing
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