Comprehensive Management Accounting Report: Imperial Brands Plc

This report provides a detailed analysis of management accounting practices at Imperial Brands Plc, a UK-based tobacco company. It examines the role and necessity of various management accounting systems (MAS), including inventory management, price optimization, and cost accounting systems. The report contrasts MAS with financial accounting, highlighting their differences in terms of information scope, timeframes, and obligations. It further explores various management accounting reports (MAR) such as account receivable aging, cost accounting, performance, and stock reports, detailing their advantages and applications within the organization. The report also delves into the amalgamation of MAS and management reporting within Imperial Brands Plc's organizational activities. Furthermore, the report investigates the usage of tools for cost evaluation, including building income statements, and analyzes planning tools for budgetary control, evaluating both their positive and negative aspects. Finally, it contrasts different management accounting system styles to address financial concerns and examines how MA enables the company to respond to financial challenges for sustainability, along with the usage of planning tools to take action against financial concerns for gaining potential outcomes.

Management
Accounting

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Examine the MA and necessities of various kinds of MA systems in organisation. ..................3
Evaluate various tools and methods of MAR. ............................................................................5
Advantages of MA system...........................................................................................................6
Amalgamation of MAS and MR in organisational activities. .....................................................7
TASK 2............................................................................................................................................7
Usage of right kind of tools for evaluation of cost by building income statement. ....................7
Usage of MA techniques..............................................................................................................9
By framing financial reports by interpret by various activities. ...............................................10
Evaluate both positive and negative aspects of planning tools for control budgets. ................10
Evaluate the various kinds of planning techniques and their applicability in context of framing
and forecasting budgets. ............................................................................................................12
TASK 4..........................................................................................................................................12
Contrast the various styles of management accounting systems to give response in against
financial concerns. ....................................................................................................................12
How MA enables to respond against the financial concerns for gaining sustainability. ..........14
Examine the usage of planning tools to take action against the concerns related with finance
for gaining potential outcomes...................................................................................................15
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................17

INTRODUCTION
MA is one of crucial aspect of accounting system for an administration that connect or
linked the tools and techniques for analysing and evaluating the knowledge and information both
for economic and non economic aspects to accumulate position of an administration . Major goal
of MA is to prepare internal and external reports related to management accounting to proceed in
business functions. In today’s world the organisations by availing economic accounting tools and
techniques to gather potential data and information about the financial projection and estimated
cost and expenditures in near future to take appropriate kind of decisions. Respective assignment
rely on Imperial Brands Plc which is an UK based Tobacco manufacturing company,
headquarters is in Bristol, UK. This report is based on MA and essential requirements of various
kinds of MA system for an organization. Further it includes various acting used by management
accounting reporting to collect data and information for gaining potential outcomes. It also
includes the calculation of cost by using the tools and method by using the marginal and
absorption costing systems to evaluate various factors. By elaborating the benefit and disfavour
by using kinds of planning tools to measure various budgetary control. At last it includes
comparison in various organisations in between management accounting systems to respond
financial problems.
TASK 1
Examine the MA and necessities of various kinds of MA systems in organisation.
Imperial brands Plc:
Respective organisation formerly known as Imperial Tobacco Group Plc which is an
multinational Tobacco company headquartered in Bristol in UK. It is the fourth largest
international Cigarette company measured by market share and world's largest producer of
Cigars, tobacco papers and many more.
Role of Management accounting:
MA is very much potential for an organisation as it plan the each and every aspect with in
organisation. Such as resources, budgets and forecasting and many more attributes. After
planning each and every event in proper manner it control it by using various tools and
techniques for setting standards in order to gain accurate results. By using benchmarking, key
performance indicators and many more to control the activities for gaining desirable outcomes.

MA as stated above, is significant aspect for an organisation that helps to proceed by
controlling both the qualitative and quantitative data and statistics to prepare the reports to gain
important insights to gain potential outcomes in positive manner (Ward, 2012). Here are the few
advantages of MAS that are as follows:
MAS is very much beneficial for an organization to accumulate and effectively utilize the
knowledge and information collected by a firm. It proved beneficial for organization in order to
estimate the futuristic actions and activities of organisational income and expenditures to gain
potential outcomes to plan and coordinate with their teams to coordinate them in proper way.
The another major benefit of MAS that it helps in control all the major works and
activities that it helps in control all the financial activities such as accumulation of financial
activities, budgeting and controlling by measuring various events for gaining potential outcomes
(Otley and Emmanuel, 2013). The another crucial kind of contribution of management
accounting system that after building fiscal reports organization can be able to evaluate various
factors that helps in decision making process. In context of Imperial brands Plc they analyse
financial reports, accounting methodologies and concepts in order to acknowledge financial
status of an organization.
So from the above discussion it has been summarized that MAS proved very much
beneficial for an organization to gain important insights and knowledge for taking effective kind
of decisions.
Comparison in between the MAS and FAS:
Basis MA Financial accounting
Important aspects MA elaborates both financial and non
financial kind of information and
data.
In financial accounting only financial
data and statistics should be covered
in order to reach at ultimate goal.
Time required to
prepare or build
reports
In this accounting, the reports are
prepared as per the requirement of the
organization in order to gain potential
outcomes.
In financial accounting the reports
collect with the help of norms of
IFRS in order to accumulate
necessary information.
Obligation MA system is not obligatory for On other hand financial accounting

organisations to comply with rules
and regulations.
proved useful for organisations to
accumulate information at regular
intervals.
So from the above discussion it has been summarized that MAS is very much essential
for an organization to accumulate necessary knowledge and information to take decisions
appropriately.
Management accounting systems
Inventory management system:
Inventory management system is a software that proved useful for tracking the level of
inventory, orders and sales with deliverables. Respective system proved useful for manufacturing
industries in order to create work order, bill of materials and other kind of production related
documents. Respective tool proved beneficial for organisation to track level of inventory to fulfil
the consumers needs and demands in appropriate manner.
Respective system of MA is significant for a firm that helps to track the movement of
relative products and services until it reached to ultimate consumer base. Also it enables to verify
the raw material and quantity of final goods to ultimate consumer base so ultimately it proved
beneficial for Imperial Brands Plc to facilitate the path to meet the demands of consumers in
positive manner. The most important function of respective system of management to maintain
records of overall transfer and also keep balance of demand and supply side to gain optimum
kinds of outputs.
Price optimization system:
Price optimisation system is one of most useful tool for an organisation to analyse or
evaluated by an organisation the way consumers respond in against different price range
regarding the products and services by using statistics and data in appropriate manner.
Respective tool proved beneficial for organisation to choose one of best prices for products and
services.
Pricing is one of the most essential function of MA which directly impacts on the demand
and supply side of the business (Parker, 2012). It is very much essential for the organisation to
affix one of best price of goods for gaining potential outcomes. Respective system proved
beneficial to set one of best price that are suitable for organisation as well as individual to track
the behaviour of consumers at every tier of their purchasing behaviour. In context of Imperial

Brands Plc by using respective kind of management accounting system examine various factors
which directly contributes in formation of pricing to gain best prices in respect of their product.
Cost accounting system:
Cost accounting system is one of most potential framework used by an organisation to
estimate the cost of products and services in proper manner. In context of Imperial Brands Plc
they by using respective tool determine cost of products and services in proper manner.
Respective system is one of most structured format to figure out the cost of products and
services to accumulate information regarding the profit and losses occurred by the organisation
at every tier of production and consumption. It proved beneficial for organisation who deals in
large product portfolio by categorised into two forms such as job order costing and process
costing system. In context of Imperial Brands Plc they by avail both kind of costing system
determine actual cost of related products of firm.
Evaluate various tools and methods of MAR.
Management accounting reports:
MAR defined as kind of reports which are composed or prepared by the organization to
control the financial and non-financial knowledge and information. There are various kinds of
reports of MA that are as follows:
Account receivable ageing reports:
Respective kinds of reports used by an organization by gathering information from
various debtors by including various kinds of debt information (Otley, 2016). The main role of
respective reports to provide assistance to financial department to provide necessary knowledge
and information to such as amount due to debtors. In context of Imperial Brand company, they
by using respective kind of financial reports their financial manager utilizes key knowledge to
prepare and collect debts.
Cost accounting report:
Respective reports after utilization of the information and knowledge by using the cost
accounting system. By using such kinds of reports by accumulating each and every activity by
predicting future actions and plan accordingly (Schaltegger and Csutora, 2012). In context of
Imperial Brands Plc they accumulate necessary information related to cost by operating various
activities related to tobacco production and consumption.
Performance report:

It is the one of most essential kind of report by evaluating outcomes after estimated the
presented variations in between the two events in proper manner. in context of Imperial Brands
Plc their managers by using respective reports take appropriate kind of decisions by using
promotional events for gaining potential outcomes.
Stock reports:
Respective kind of financial reports is very much similar to cost accounting reports that
build by the after integrating the strong inventory management system. Respective kind of
information give detailed description about quantity that are accumulated in the warehouses as
well as in he production of the products and services in order to gaining potential outcomes by
collecting data and statistics properly. In context of Imperial brands Plc they accumulate
necessary information regarding the purchasing the raw material to compete in business
environment. With the help of various stock methods such as LIFO, FIFO and other aspects, in
context of Imperial brands Plc they for manufacture the tobacco products and services to keep
eye on every aspect for taking essential kind of decisions.
Advantages of MA system
Inventory management system:
Major advantage of IMS is to link with various processes of quantity and cost factors by
using kinds of materials utilized by an organization. In context of Imperial Brand plc they gain
important benefits from accounting system to the production system of tobacco in cost effective
manner.
Price optimization system:
Respective kind of MAS is proved beneficial by administration to get revise by using the
pricing strategies as per the need and wants of consumers (Fullerton and et. al., 2014).
Respective organization revise their pricing strategies as per the competitors pricing to gain
optimum kinds of results.
Cost accounting system:
With the help of CAS, by using overall production and expenditure by evaluating
various aspects in controlled manner in best effective way or manner. in context of Imperial
Brand Plc in their financial department optimize key financial information by controlling over
the cost by controlling various events.

Amalgamation of MAS and MR in organisational activities.
In MAS the wide range of accounting system are included in each and every item by
inclined to gain continuous process and objectives. In context of Imperial Brands Plc there all
departments integrated with one another by sharing the cognition and information to one another
to reach at optimum objectives (Arroyo, 2012). They integrate the goals of finance department
with marketing and human resource by aligned their various aspects. For an example in
respective organization by using various reports such as cost accounting reporting, stock reports
they allocate roles and responsibilities to them.
TASK 2
Usage of right kind of tools for evaluation of cost by building income statement.
For an organization to prepare the income statement it is very much necessary to optimize
the different kinds of cost factors which enables to gain important insights and information such
as deliver one of best prices to consumers, to analyse competitors pricing and many more factors.
In context of Imperial Brands Plc, they use various kinds of costs that are as follows:
Absorption costing:
Respective kind of cost helps to organization by using various kind of technique by
relating the fixed and non-fixed kind of cost to prepare financial statements by examine every
factor associated with the firm. In context of Imperial Brands Plc, they by using idea both fixed
and non-fixed cost related to their project to bring it into practice.
Marginal costing:
In marginal costing the organization use the both fixed cost by relating the periodical
units of cost in order for gaining potential outcomes. In context of Imperial Brands by using the
Marginal costing system they evaluate both fixed and non-fixed cost by demonstrating various
factors (Maas, Schaltegger and Crutzen, 2016).
Problem 1.
Problem 1 (1):

Problem 1 (2):

P
Problem 2/ 2 (a)
Problem 2/ 2 (b)

Reconciliation of Profits under the two systems:
Budgeting:
Budgeting is the process of creating a plan for spending money which allows to execute
things in proper manner. It is proved beneficial to track the finances and map all activities in
order to reap important outcomes.
Cash flow:
Cash flow statement is very much important information to observe the inflow and
outflow of cash to operational the activities in proper manner. It provides aggregated data to
acknowledge the current position of an organisation in order to invest in projects by
acknowledging important attributes.
Cost breakdown structure:
It is the cost allocation to the lowest level of WBS, in it various kinds of cost including
all works and services in order to gain potential outcomes. It is the cost of various components of
the structure includes of key features such as visual insight by integrated together for gaining
potential outcomes.

Usage of MA techniques.
Management accounting tools to build reports in context of an organization. In today’s
scenario the MAR plays very major role in the life of an individual as well as organization to
gain important insights such as financial projections, future plans and policies and concepts to
build one of best strategies to remain always competitive in market place (Shah and et. al., 2011).
The major objective behind preparation of financial reports that it elaborates the internal and
external information to share with the stakeholders to acknowledge the facts and figures which
proved beneficial in decision making. To prepare and gather information there are various kinds
of cost accounting reports proved beneficial such as marginal costing, absorption costing and
other too. In context of chosen organization, they on periodically basis prepare the financial
reports and then share with their both internal and external stakeholders by setting standards and
then compare by it that how far organization near to their goals and objectives.
Except from the above mentioned tools and techniques organization uses other cost
accounting tools to build financial statements such as standard costing, activity based accounting
and zero based accounting which devotes to deliver one of best attributes in life of an individual
as well as organization to provide the basis framework before their stakeholders to demonstrate
crucial outcomes.
By framing financial reports by interpret by various activities.
From above practical, it has been summarized that income statement is very much
important for an organization to shows the financial position and loop falls in order to put one of
best efforts in right direction to co relate with past data and statistics. It has been observed that
from the MC technique the net profit of organization is £555000 and by evaluating the marginal
costing organisations net profit is £781000. There is huge difference in both kinds of financials
data and information and reason behind it that is 226000 organization using various techniques.
Communication Matrix:
Communication Purpose Medium frequency Audience
Project team
meetings
Review status of
a project
Face to face or
conference call
Weekly Project team
Technical and To discuss and In person or face As needed Technical team

creative design
meetings
review technical
and design
problems
to face creative team
Project status
reports
Detailed
description of
projects in
regards of cost
and problems
By email Monthly Project manager
stakeholders
Various kinds of risk:
In a project there are various kinds of risk occurs that are technical, external and project
related risk.
Technical risk:
In technical risk associated with directly knowledge base being employed and major
mistakes in projects such as safety, loss prevention and consequential cost reduction.
External risk:
In external risk consist of Political and economical factors while enlarge business
opportunities in order to combat with negative effects.
Project related risk:
In project risk related to the lack of resources, not proper management and not proper
communication in team. In context of Imperial Brands Plc they majorly face the risk related to
project as it takes time to manage each and every attribute.
Quality control:
To gain potential outcomes it is very essential to maintain quality that by using various
tools and techniques that are
control chart:
Control chart is kind of graph which measures the process changes over time. In it data
and statistics plotted in time order. It has central line for average, upper line to control quality of
products in optimum manner.
flow chart:

To control quality flow chart is a kind of diagram that represents the workflow process by
using the step by step approach to solve a specific task in proper manner. In context of Imperial
Brands Plc they by using the control chart they manage the quality in proper manner to gain
potential outcomes.
Evaluate both positive and negative aspects of planning tools for control budgets.
In an organizations planning tools and techniques plays very crucial role by collect
required cognition and message and then build strategies to take appropriate decisions
accordingly (Taipaleenmäki and Ikäheimo, 2013). There are diverse kinds of planning tools and
method that used by an organisation to depict the facts and figures in proper manner. in context
of Imperial Brand Plc they use various methods and ways after judging its advantages and
disadvantages in context of organization to gain important insights out of them. Here are the
various planning tools and techniques with their positive and negative effects are as follows:
a) Zero based budgeting: Zero based budgeting in management accounting involves the
preparation of budget by scratching with a zero base. It helps to re-evaluate each and every item
by cash flow statement to justify the expenditures that occurs in a department to gain important
insights in proper manner. it is one of best method to calculate the actual expenses that are
incurred and not on the differential basis but involves the changes in their operational works and
activities. In context of Imperial Brand Plc by using all kind of cost and expenditures that occurs
in their business they accumulate potential data from them to take decision in appropriate
manner. there are some kind of pros and cons of zero based budgeting that are as follows:
Pros: The biggest advantage is that the budget is prepared on the basis of current trends
and requirements instead of historical trends and companies can have actual control over their
costs and reallocation of money at the right place.
Respective budget helps to managers to consider the way each and every penny is spent on
various activities in each budgeting period. So respective kind of budget proved beneficial for
organisation to plan and coordinate the spendings of organisation in proper manner.
Cons: The zero based budgeting method takes a lot of time and money of the companies
as it is built from scratch and it might not consider fixed costs. The major shortcoming of
respective budget that it give reward to short term shifting of resources in direction of companies
that helps to generate revenue in next calendar year or budgeting period.

b) Sales Budget: Sales budget is made by the companies to forecast sales expenses and
revenues of the firm. This budget is used as a base to prepare other budgets. It helps in accurately
predict the quantity that can be sold and for what value during the coming year (Chenhall and
Moers, F., 2015). The budget describes in detail that how much sales is expected as per the area
and product categories. To prepare this budget, past trend of sales, seasonal demands, pasty
reports made with the help of sales team and present orders with the company are considered.
Pros: Sales budget helps in proper planning and allocation and acts as a benchmark for
preparing all the budgets. Companies can also help in monitoring the targets that were
anticipated and keeps everyone on the track. The budgeting of various departments rely on the
sales budget as it true in context of production company where the production expenses are
proportional to amount that they aspire to gain.
Cons: Sales budget takes a lot of management time as it is difficult to forecast accurate
sales due to sudden changes in the market situations. If the sales budget is unrealistic, it may
even create demotivation among the employees. Sales budget always be not 100% accurate since
no one can predict in proper manner or events as per the sudden market trends of company.
c) Production Budget: This budget is prepared based on the sales budget. It is used to
forecast the production costs and looks at the overall manufacturing area of the company (Cadez
and Guilding, 2012). This budget also tells that how much stock level has to be maintained
during the year, how much raw materials would be required and what should be the stock
replenishment duration. The budget is made by keeping in mind the following factors i.e. sales
budget, capacity of the manufacturing plant, availability of the labour, electricity and different
sources required for production.
Pros: With the help of this budget, there is no delay in the procurement of raw materials
as well as there are no pending orders from company side. It assist in maintaining the optimum
level of balance in between the inventory position and production of organisation that contributes
in policies and plans related to organisation.
Cons: The main disadvantage of this budget is that the focus is solely on estimating the
production cost and less focus is kept on how much actual production should be there to achieve
the targets. Construction of production budget by the company is one of the most time
consuming process as it needed lots of time and efforts to manage activities of organisation.

Evaluate the various kinds of planning techniques and their applicability in context of framing
and forecasting budgets.
Using different planning tools like cash budget, financial budget, production budget, sales
budget, zero-based budget, etc. helps a business in making their budgeting process better and
efficient. When these tools are used in a correct manner, it facilitates a lot in better decision
making and give better insights that in which area more funds are required, which area is weak
and needs to be monitored and at which area growth can be achieved (Herbert and Seal, 2012).
It helps a business owner to analyse that whether targets are met as per the estimations and if not
met then where the business was lacking and what actions can be taken to correct that problem.
TASK 4
Contrast the various styles of management accounting systems to give response in against
financial concerns.
Organizations face many financial problems in the changing business environment like
decreasing sales revenue and increasing expenses. Identification of these problems is very
important for the business to take proper actions on time and to remain competitive in the
industry. To identify these monetary issues, company can make use of different benchmarks,
some key performance indicators (KPIs) whether monetary or non-monetary and the set targets
in the budget. Let's discuss these points in detail:
Benchmarking: Benchmarking means comparing your business to the competitor who is
superior in the field and then identifying that where the business is lacking. Through
benchmarking, companies can identify the areas which requires improvement. Respective tool is
used in organisation extensively but there are no universal process to conduct within the
organisation. Each and every organisation designs it in their own way. By using various
processes organisation can apply it within their organisation in order to remain competitive.
Key Performance Indicators: KPIs is used to measure the performance of the business
by using both monetary and non-monetary indicators. Before identifying that what KPIs should
be used, companies should understand what is most important for them as for every problem
KPIs can be different (Caglio and Ditillo, A., 2012). Financial KPIs include financial ratios like
curtrent ratio, net profit margin, operating cash flow ratio, working capital, accounts receivables ,
accounts payables, ROE, Debt to Equity ratio, etc. Non-financial KPIs includes wuality,

customer satisfaction, customer relationship, customer experience, brand image and reputation,
positioning, talent of the organization, etc. Balance Scorecard can be used to identify KPIs. Both
these financial as well as non financial measures should be given equal importance in estimating
and forecasting.
Balance Scorecard: Balance scorecard is a key metric to analyse the performance and
identify the various business problems which a company is facing internally. It helps to improve
the performance by offering proper feedback to the companies (Morales and Lambert, 2013).
Hence, accurate collection of data is essential in offering the exact results and better
interpretation so that it can be used to make important decisions related to financial problems. It
also includes both monetary and non-monetary aspects of performance. A key way for
organisation to implement the basic disciplined framework that it provides respective
organisation the dots to connect in between various components of strategic planning and
management that people are working on to track the success in proper manner.
Financial Governance: This is a method in which proper reporting and disclosure of the
transactions is done in accurate and efficient way so that issues can be identified that where the
business is lacking (Figge and Hahn, 2013). Financial governance basically reflects that how the
companies manage the financial information i.e. the way of collecting managing, recording,
controlling and monitoring it on a regular basis. It focusses on the company's method of tracking
the financial information, transactions by following proper laws, regulations, compliance and
best practices.
Agency theory: Respective principle that extensively used and helps to resolve the issues
by setting relationship in business principles and their agents. The relationship is in between the
shareholders, principles and company executives to remain competitive in marketplace.
Activity based costing (ABC): Activity based costing method is used by large number
of companies as here the costs are identified related to each activity rather than a product. Under
this, the company identify every activity that is performed in an organization and then allocate
the costs related to every activity. The costs of activity are then allocated to the products of the
organization (van der Steen, 2011). ABC method takes into consideration both direct and indirect
costs which COGS don't consider and that make it more useful to set the prices as manager can
find out more accurate prices with the help of Activity based costing.

To resolve these financial issues, company can make use of different management accounting
system like cost accounting system, inventory management, job costing system and price
optimization system.
The below table shows the comparison of two automotive companies of UK which faced
a financial and have successfully used Management accounting system to resolve that issue. The
first column of the table shows the three basis of comparison i.e. first what was the financial
problem they faced, method they used to identify that problem and finally which management
accounting system they used to resolve that. Two companies taken here are General Motors and
Volkswagen.
Basis for
Comparison
General Motors Volkswagen
Financial Problem Company is facing the issue of
decreasing sales and increasing tariffs.
Company's is facing losses due
to increase in the expenses,
decrease in the revenues and
high prices.
Method used to
identify the problem
Company used the key performance
indicator to detect the problem.
Financial indicators like key ratios were
used to analyse the performance and
non-financial measures like customer
satisfaction was used.
Company used Financial
Governance and identified the
problem through its accounting
and financial statements.
MAS Company is using the Cost accounting
method to solve this problem. It is
specifically using Activity based
costing method to identify the costs
related to each activity performed.
Rather then applying costs direct to the
products of the company, each activity
is analysed by General Motors to
analyse the profitability, expenses and
Tata Motors is using Price
Optimisation System as it is
facing the issue with pricing
and decrease in the revenues.
So, using this system company
can set the prices optimally
which is acceptable by the
consumers as well. So, there
financial issue will be resolved

sales of the company. using this management
accounting system.
How MA enables to respond against the financial concerns for gaining sustainability.
Using the management accounting, companies can bring sustainable success and can
reduce a lot of financial problems it is facing. The company can make use of different techniques
like variable costing, absorption costing, activity based costing, break even method which will
help in making various strategies and decision making and can lead to sustainable and stable
success of the organization (Cooper and et. al., 2017). It will also help the managers in
formulating policies which will help in the growth of the organisation. As management
accounting helps in creating a lot of reports like performance reports, cost reports and budgets
which makes planning and budgeting easier. It also allows the good reporting of financials which
creates proper financial governance and helps in integrating the issues related to sustainability.
Examine the usage of planning tools to take action against the concerns related with finance for
gaining potential outcomes.
Planning tools that are there in management accounting like different kind of budgeting
techniques, various management accounting systems help in proper identification of the
problems the management is facing in its financials. This can be used to plan and make strategic
decisions on various aspects which can lead to the growth and success of the organization. The
tools can also be used to improve the reporting and interpretation of the figures and data.
Company can also make use of it to make investment related decisions (Bouten and Hoozée,
2013). Management accounting plays an important role on various aspects like planning and
implementing. As various amount of information and details are collected through various
reports of performance, product, costs and through budgeting, it significantly helps the managers
to implement and make plans which was decided during the budgeting process. This helps in
allocating the resources in an efficient manner and save a lot of unnecessary costs for the
company. If the company gets successful in using the management accounting methods, then it
will create a competitive edge for the company as the strategies will be well planned and the
focus will be more on creating a better brand reputation while simultaneously reducing the costs.

CONCLUSION
Respective assignment rely on MA is one of most important tool for an administration
to monitor, evaluate and control the organizational works and activities in proper manner.
different organizations to serve various purposes uses differ kind of management accounting
system or techniques such as cost accounting, stock report and many others tools to demonstrate
the effect of respective results on organizational goals and objectives. There is close relationship
in between the MAS and reporting that demonstrates the effect on organisational works and
activities on both negative and positive manner. the management accounting reports plays very
crucial role to effectively showcase the financial projections and their effect on their works and
activities that are Zero based budgeting and rolling budgeting to eliminate the various kinds of
issues or concerns in financial accounting. In an organisations various kinds of planning tools
and techniques plays very contributory role to plan each and every aspect in proper manner to
eliminate the negative effects at maximum level. For an organization to methods of adaptations
of management accounting system vary from one another that directly relates with their goal and
way to respond against financial problems or concerns.

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APPENDIX
U n it S e llin g Pric e 8
U n it V a ria b le C o s t 3
F ix e d Ma n u fa c tu rin g E x p e n s e s 1 5 0
N o n Ma n u fa c tu rin g E x p 5 0
B u d g e te d A c tiv ity 7 5
Pe rio d 0 4 /1 9 0 5 /1 9 0 6 /1 9 0 7 /1 9 0 8 /1 9 0 9 /1 9
[£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ]
S a le s 7 5 6 0 9 0 7 5 7 0 8 0
Pro d u c tio n 7 5 7 5 7 5 7 5 8 5 7 5
O p e n in g in v e n to ry 0 0 1 5 0 0 1 5
Pe rio d 0 4 /1 9 0 5 /1 9 0 6 /1 9 0 7 /1 9 0 8 /1 9 0 9 /1 9
[£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ]
S a le s 6 0 0 4 8 0 7 2 0 6 0 0 5 6 0 6 4 0
O p e n in g In v e n to ry 0 0 4 5 0 0 4 5
A d d : V a ria b le C o s t [Pro d n .] 2 2 5 2 2 5 2 2 5 2 2 5 2 5 5 2 2 5
L e s s : C lo s in g In v e n to ry 0 4 5 0 0 4 5 3 0
Ma rg in a l C o s t o f S a le s 2 2 5 1 8 0 2 7 0 2 2 5 2 1 0 2 4 0
C o n trib u tio n Ma rg in 3 7 5 3 0 0 4 5 0 3 7 5 3 5 0 4 0 0
L e s s : F ix e d Ma n u fa c C o s t 1 5 0 1 5 0 1 5 0 1 5 0 1 5 0 1 5 0
L e s s : N o n Ma n u fa c C o s t 5 0 5 0 5 0 5 0 5 0 5 0
U n it S e llin g Pr ic e 8
U n it Pro d u c tio n C o s t [ V a ria b le + F ix e d ] 5
N o n Ma n u fa c tu rin g E x p 5 0
B u d g e te d A c ti v ity 7 5

Pe rio d 0 4 /1 9 0 5 /1 9 0 6 /1 9 0 7 /1 9 0 8 /1 9 0 9 /1 9
[£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ]
S a le s 7 5 6 0 9 0 7 5 7 0 8 0
Pro d u c tio n 7 5 7 5 7 5 7 5 8 5 7 5
O p e n in g in v e n to ry 0 0 1 5 0 0 1 5
Pe rio d 0 4 /1 9 0 5 /1 9 0 6 /1 9 0 7 /1 9 0 8 /1 9 0 9 /1 9
[£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ]
S a le s 6 0 0 4 8 0 7 2 0 6 0 0 5 6 0 6 4 0
O p e n in g In v e n to ry 0 0 7 5 0 0 7 5
A d d : C o s t o f Pro d u c tio n [ V a ria b le + F ix e d O v e rh e a d s ]3 7 5 3 7 5 3 7 5 3 7 5 4 2 5 3 7 5
L e s s : C lo s in g In v e n to ry 0 7 5 0 0 7 5 5 0
O v e r/U n d e r re c o v e ry o f o v e rh e a d s0 0 0 0 -2 0 1 0
C o s t o f S a le s 3 7 5 3 0 0 4 5 0 3 7 5 3 3 0 4 1 0
G ro s s Pro fi ts / L o s s 2 2 5 1 8 0 2 7 0 2 2 5 2 3 0 2 3 0
L e s s : N o n Ma n u fa c u rin g C o s t 5 0 5 0 5 0 5 0 5 0 5 0
Reconciliation of Profits under the two systems
Pe rio d 0 4 /1 9 0 5 /1 9 0 6 /1 9 0 7 /1 9 0 8 /1 9 0 9 /1 9
[£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ]
S a le s 7 5 6 0 9 0 7 5 7 0 8 0
Pro d u c tio n 7 5 7 5 7 5 7 5 7 5 7 5
O p e n in g in v e n to ry 0 0 1 5 0 0 1 5
Pe rio d 0 4 /1 9 0 5 /1 9 0 6 /1 9 0 7 /1 9 0 8 /1 9 0 9 /1 9
[£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ] [£ '0 0 0 ]
N e t Pro fi ts u n d e r A b s o rp tio n C o s tin g1 7 5 1 3 0 2 2 0 1 7 5 1 8 0 1 8 0
A D D : F ix e d O v e rh e a d s in o p e n in g0 0 3 0 0 0 3 0
L E S S : F ix e d O v e rh e a d s in c lo s in g0 3 0 0 0 3 0 1 0