Management Accounting Report: Oshodi PLC, MA Systems and Cost Analysis
VerifiedAdded on 2021/02/19
|22
|5897
|57
Report
AI Summary
This report delves into the application of Management Accounting (MA) principles within Oshodi PLC, a production enterprise specializing in JOJO fruits. The report examines the importance of various MA systems, including inventory management, cost accounting, job costing, and price optimization, highlighting their roles in providing crucial information for decision-making and achieving a competitive advantage. It explores different MA reporting techniques such as budget reports, cost reports, performance reports, and account receivable aging reports. Furthermore, the report analyzes the benefits of MA systems, such as improved sales through inventory management and effective cost allocation through job costing. The report also examines absorption and marginal costing methods, outlining their impact on pricing and production decisions. The report concludes by emphasizing the integration of MA systems with reporting to achieve organizational goals and objectives.

Management
Accounting
Accounting
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser

Table of Contents

INTRODUCTION
MA also called as cost accounting that are chain of activities for identification,
measurement and analyse with interpretation by communicating knowledge and information to
get desirable goals and objectives. It is one of most crucial activity to understand the
commercial with costing collection by translating in important knowledge and information. So
MA crucial for a firm to deliver and accommodate necessary information for getting competitive
advantage. This report rely on Oshodi PLC that well known production enterprise have expertise
in production of JOJO fruits for all age people. This assignment rely on MA and importance of
various MA system with included tools for reporting of MA. It also studies the cost and related
advantages such as absorption and marginal cost to get important details. At last it focus on
planning tools with benefits and drawbacks of various kinds of techniques to plan which
administration can adapt management accounting systems to eradicate fiscal trouble.
TASK 1
P1
MA refers to crucial aspect for an organisation to transform the process after analyse
costing which associated by products so that important decisions should be reap out.
Management accountants observe or evaluate the various events regarding the business after
evaluating demand of consumers in better style. In an organisation to coordinate various
activities they should be apply different ways of MA systems here are:
Management accounting takes financial information and after that build reports by
internally and confidentially from managers that enables in occupy best opportunities by
evaluating ways to operate a business in effective way.
Inventory management systems:
IM is an crucial discipline regarding the specify the shape and coordinate stocked goods
(Armitage, Webb and Glynn, 2016). Goods or stocked goods needed at every location to check
its visibility for supply various types of goods and services at last-ditch user base. So it helps to
balance the both demand and supply side for giving delighted experience to customers base . It
majorly tracks the two crucial functions stock room of organisation by receiving information and
shipping also. It ultimately proved helpful to accurately know the current inventory level. Oshodi
MA also called as cost accounting that are chain of activities for identification,
measurement and analyse with interpretation by communicating knowledge and information to
get desirable goals and objectives. It is one of most crucial activity to understand the
commercial with costing collection by translating in important knowledge and information. So
MA crucial for a firm to deliver and accommodate necessary information for getting competitive
advantage. This report rely on Oshodi PLC that well known production enterprise have expertise
in production of JOJO fruits for all age people. This assignment rely on MA and importance of
various MA system with included tools for reporting of MA. It also studies the cost and related
advantages such as absorption and marginal cost to get important details. At last it focus on
planning tools with benefits and drawbacks of various kinds of techniques to plan which
administration can adapt management accounting systems to eradicate fiscal trouble.
TASK 1
P1
MA refers to crucial aspect for an organisation to transform the process after analyse
costing which associated by products so that important decisions should be reap out.
Management accountants observe or evaluate the various events regarding the business after
evaluating demand of consumers in better style. In an organisation to coordinate various
activities they should be apply different ways of MA systems here are:
Management accounting takes financial information and after that build reports by
internally and confidentially from managers that enables in occupy best opportunities by
evaluating ways to operate a business in effective way.
Inventory management systems:
IM is an crucial discipline regarding the specify the shape and coordinate stocked goods
(Armitage, Webb and Glynn, 2016). Goods or stocked goods needed at every location to check
its visibility for supply various types of goods and services at last-ditch user base. So it helps to
balance the both demand and supply side for giving delighted experience to customers base . It
majorly tracks the two crucial functions stock room of organisation by receiving information and
shipping also. It ultimately proved helpful to accurately know the current inventory level. Oshodi
⊘ This is a preview!⊘
Do you want full access?
Subscribe today to unlock all pages.

Trusted by 1+ million students worldwide

PLC uses the FIFO kind of inventory system to succeed and coordinate actions concerned with
the inventory in proper way.
Cost accounting system:
CAS availed by producers to capture and evaluate actions related with production by
availing the inventory system (Bobryshev and et.al., 2015). It is majorly designed for to track
and record directions of stocked goods at kinds of tier for manufacturing goods process. In
context of Oshodi PLC they by using cost accounting system estimate with related cost while
producing goods analysing level of gainfulness, appraisal of stocked goods by measuring
costing in better style. So that very much crucial part of MAS by delivering final goods and
services by measuring each and every factor in better manner.
Job costing system:
JC accounting that a chain of activities by assigning cost that related with a particular
job or a business activity. That management system widely used for the manufacturing and
construction industries by allocating costs at time of production of goods in better way. In JBS
various types of cost involved in it which are direct substantial, manpower and kinds of cost
with many more. In context of Oshodi PLC they use the job costing system for assign the cost of
a particular business activity to remain always competitive in market place.
Price optimisation system:
Price optimisation system proved helpful for finding the best price for products and
services to get maximum pay from consumers and enhance their willingness to purchase
products (Brennan and Merkl-Davies, 2013). By using for evaluating the fluctuations in supply
of products in both B2B and B2C kind of business they deliver lot of time and efforts for setting
price optimisation by ensuring that their products should reach frequently and maximise profit.
In context of Oshodi PLC they by using that management accounting system by calculating
demand which differ from various cost steady after combining content with basis of stocked
goods by recommending best cost.
For a firm all various types of MAS play an important base by delivering the basic value
and deliverables that ultimately helps in taking decision making. It enables to transform the
knowledge that contains into reports, financial statements and in other documents. It tracks each
and every activity until reaches to ultimate consumer base in proper way.
the inventory in proper way.
Cost accounting system:
CAS availed by producers to capture and evaluate actions related with production by
availing the inventory system (Bobryshev and et.al., 2015). It is majorly designed for to track
and record directions of stocked goods at kinds of tier for manufacturing goods process. In
context of Oshodi PLC they by using cost accounting system estimate with related cost while
producing goods analysing level of gainfulness, appraisal of stocked goods by measuring
costing in better style. So that very much crucial part of MAS by delivering final goods and
services by measuring each and every factor in better manner.
Job costing system:
JC accounting that a chain of activities by assigning cost that related with a particular
job or a business activity. That management system widely used for the manufacturing and
construction industries by allocating costs at time of production of goods in better way. In JBS
various types of cost involved in it which are direct substantial, manpower and kinds of cost
with many more. In context of Oshodi PLC they use the job costing system for assign the cost of
a particular business activity to remain always competitive in market place.
Price optimisation system:
Price optimisation system proved helpful for finding the best price for products and
services to get maximum pay from consumers and enhance their willingness to purchase
products (Brennan and Merkl-Davies, 2013). By using for evaluating the fluctuations in supply
of products in both B2B and B2C kind of business they deliver lot of time and efforts for setting
price optimisation by ensuring that their products should reach frequently and maximise profit.
In context of Oshodi PLC they by using that management accounting system by calculating
demand which differ from various cost steady after combining content with basis of stocked
goods by recommending best cost.
For a firm all various types of MAS play an important base by delivering the basic value
and deliverables that ultimately helps in taking decision making. It enables to transform the
knowledge that contains into reports, financial statements and in other documents. It tracks each
and every activity until reaches to ultimate consumer base in proper way.
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser

P2
MA that helps to produce the reports for an organisation internal stakeholders against the
external stakeholders. Its result of MA for preparing periodic reports for an organisation and
various departments. For an organisation it is important to evaluate varies types of MAC
techniques for coordinating and communicating necessary information to ultimate consumer
base.
Budgets report:
Budget is a financial document that build on behalf of income and expenditure for a
specific time period. In context of manufacturing company, they include in their budget the
expected items that should be sold out and produce with resources required to builds products in
well manner. By using the simple model of production and sales that are the initial stage of
budgeting process with help of historical accounting knowledge and information. It proved
beneficial to forecast budget by assuming the sales unit over a specified time period. In context
of Oshodi PLC prepare financial budget by predicting each and every variable that helps in
forecasting budget in proper manner.
Cost reports:
Managerial accounting proved beneficial to determine cost of goods. It should be taken
as the complete fresh price of products, overhead cost, labour price and many more factors that
come into consideration (Burns, 2014). in that whole process cost should be bifurcated into total
no. of unit that are build at time of manufacture goods better way. In cash data brief in nature
that helps managers to observe pricing of goods in against the selling cost. It proved beneficial
for managers to plan by managing limit of their income. In context of Oshodi PLC by using cost
reports calculate various kinds of prices that are very much important for them for achieving
organisational goals and objectives.
Performance reports:
Performance reports refers to the collection of necessary knowledge and information
related with the performance of an individual, then analysing it and creating reports on them and
send them to respective stakeholders that are part of reporting of performance related to project.
It is an important part of communication management plan for achieving organisational goals
and objectives. With the help of reports a manager should be determine for review an individual
actions and activities for accordingly liable to best serve to them. It provides all necessary
MA that helps to produce the reports for an organisation internal stakeholders against the
external stakeholders. Its result of MA for preparing periodic reports for an organisation and
various departments. For an organisation it is important to evaluate varies types of MAC
techniques for coordinating and communicating necessary information to ultimate consumer
base.
Budgets report:
Budget is a financial document that build on behalf of income and expenditure for a
specific time period. In context of manufacturing company, they include in their budget the
expected items that should be sold out and produce with resources required to builds products in
well manner. By using the simple model of production and sales that are the initial stage of
budgeting process with help of historical accounting knowledge and information. It proved
beneficial to forecast budget by assuming the sales unit over a specified time period. In context
of Oshodi PLC prepare financial budget by predicting each and every variable that helps in
forecasting budget in proper manner.
Cost reports:
Managerial accounting proved beneficial to determine cost of goods. It should be taken
as the complete fresh price of products, overhead cost, labour price and many more factors that
come into consideration (Burns, 2014). in that whole process cost should be bifurcated into total
no. of unit that are build at time of manufacture goods better way. In cash data brief in nature
that helps managers to observe pricing of goods in against the selling cost. It proved beneficial
for managers to plan by managing limit of their income. In context of Oshodi PLC by using cost
reports calculate various kinds of prices that are very much important for them for achieving
organisational goals and objectives.
Performance reports:
Performance reports refers to the collection of necessary knowledge and information
related with the performance of an individual, then analysing it and creating reports on them and
send them to respective stakeholders that are part of reporting of performance related to project.
It is an important part of communication management plan for achieving organisational goals
and objectives. With the help of reports a manager should be determine for review an individual
actions and activities for accordingly liable to best serve to them. It provides all necessary

information that are required at all level of an organisation to lead in marketplace . In context of
Oshodi PLC by taking that reporting system they can be able to better serve their employees by
identifying their key skills and abilities that ultimately give motivation to them.
Account receivable ageing report:
ARG is a kind of written report that list out consumer invoices and various kinds of
credit entry by using data extent. That a kind of first hand instrument that avail by collection
personnel that helps to determine about overdue of payment (Edwards, 2013). It used as a
collection tool that contain contact information for each and every consumer base. In respective
organisation Oshodi PLC with availing techniques and tool firm should be evaluate financial
health of their consumers so that they can give best goods accordingly.
It can be said that for a firm to correlate various tools and techniques so that better results
should be accomplished for achieving best results that are measurable in nature.
M1
For an organisation some important benefits of manageable accounting system that are
here:
Management accounting
system
Benefits
Inventory management
systems
That kind of group helps to organisation to enhance sales by
balance both demand and supply side of their products by
acknowledging the viability of their products. It proved
beneficial in enhancing the transparency while dealing with
situations such as in context of Oshodi PLC they by tracking
each and every activity until it reaches at ultimate consumer
base. It is an kind of combination of technology and various
kinds of processes that helps to Oshodi Plc in their monitoring
and maintenance of stocked products and services to get proper
outcomes. So it is very much effective for an organisation to
evaluate each and every attribute such as raw material, suppliers
and finished products to sent to end users.
Cost accounting system: Cost accounting system proved beneficial for organisation in
Oshodi PLC by taking that reporting system they can be able to better serve their employees by
identifying their key skills and abilities that ultimately give motivation to them.
Account receivable ageing report:
ARG is a kind of written report that list out consumer invoices and various kinds of
credit entry by using data extent. That a kind of first hand instrument that avail by collection
personnel that helps to determine about overdue of payment (Edwards, 2013). It used as a
collection tool that contain contact information for each and every consumer base. In respective
organisation Oshodi PLC with availing techniques and tool firm should be evaluate financial
health of their consumers so that they can give best goods accordingly.
It can be said that for a firm to correlate various tools and techniques so that better results
should be accomplished for achieving best results that are measurable in nature.
M1
For an organisation some important benefits of manageable accounting system that are
here:
Management accounting
system
Benefits
Inventory management
systems
That kind of group helps to organisation to enhance sales by
balance both demand and supply side of their products by
acknowledging the viability of their products. It proved
beneficial in enhancing the transparency while dealing with
situations such as in context of Oshodi PLC they by tracking
each and every activity until it reaches at ultimate consumer
base. It is an kind of combination of technology and various
kinds of processes that helps to Oshodi Plc in their monitoring
and maintenance of stocked products and services to get proper
outcomes. So it is very much effective for an organisation to
evaluate each and every attribute such as raw material, suppliers
and finished products to sent to end users.
Cost accounting system: Cost accounting system proved beneficial for organisation in
⊘ This is a preview!⊘
Do you want full access?
Subscribe today to unlock all pages.

Trusted by 1+ million students worldwide

fixation of prices of products and services on basis of demand. It
proved helpful to give best experience to consumers by
allocating right kind of prices related to goods of Oshodi PLC.
Job costing system JCS proved beneficial for managers with individuals by
calculating the individual’s jobs and help out that specific job is
for them or not. It acts as determining the level of profitability of
the job and enables for future consumers to decide that they take
interest or not in particular job. In context of Oshodi PLC they
by using it determine the specific job that proved fruitful for
organisation. In context of Oshodi Plc they use JCS for assigning
and accumulating the various kinds of costs such as
manufacturing cost of an individual unit output. They helps in
various items produced in various manner that has significant
associated with it.
D1
MA system integrate with the accounting reporting to get best organisational process by
contributing best efforts in context of a firm. For an example their cost accounting system
aligned with the processing of goods to get proper outputs in better way (Gond and et.al.,
2012.). It can be possible for organisation to get better kind of resources aligned with the
organisational works and processes to remain always competitive in market place. So it can be
concluded that MAS aligned with the its reporting should be able to achieve goals. In context of
Oshodi PLC they integrate both the management accounting system and reporting to take major
decisions with the help of management accounting system that provides current and relevant
numbers that deliver important data regarding the profitability of business and accordingly
reports should be build.
TASK 2
P3
In an organisation different types of pricing associated to get better results by using
various kinds of costs that are as follows:
proved helpful to give best experience to consumers by
allocating right kind of prices related to goods of Oshodi PLC.
Job costing system JCS proved beneficial for managers with individuals by
calculating the individual’s jobs and help out that specific job is
for them or not. It acts as determining the level of profitability of
the job and enables for future consumers to decide that they take
interest or not in particular job. In context of Oshodi PLC they
by using it determine the specific job that proved fruitful for
organisation. In context of Oshodi Plc they use JCS for assigning
and accumulating the various kinds of costs such as
manufacturing cost of an individual unit output. They helps in
various items produced in various manner that has significant
associated with it.
D1
MA system integrate with the accounting reporting to get best organisational process by
contributing best efforts in context of a firm. For an example their cost accounting system
aligned with the processing of goods to get proper outputs in better way (Gond and et.al.,
2012.). It can be possible for organisation to get better kind of resources aligned with the
organisational works and processes to remain always competitive in market place. So it can be
concluded that MAS aligned with the its reporting should be able to achieve goals. In context of
Oshodi PLC they integrate both the management accounting system and reporting to take major
decisions with the help of management accounting system that provides current and relevant
numbers that deliver important data regarding the profitability of business and accordingly
reports should be build.
TASK 2
P3
In an organisation different types of pricing associated to get better results by using
various kinds of costs that are as follows:
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser

Absorption costing:
AC is kind of MAC method in which various kinds of expenses consisted at time of
manufacture goods as per principles of accounting with outside coverage (Guthrie, Ricceri and
Dumay, 2012). There are some kinds of direct costs associated while manufacture a goods and
services by converting them into final products to deliver at ultimate consumer base. In that all
kinds of overhead cost such as utility cost and many more are come under it. In that cost directly
consisted each and every factor that directly includes in producing the product and services.
Marginal costing:
MC of production that bring modifications in cost by bringing production of units to
remain always competitive in market. Major purpose of MC for determine at time scale for that
firm could achieve economies of scale to remain always leading in scenario. The marginal cost
that helpful in production that manufacturers by getting optimum level of production. It is
helpful to producing one additional unit and get revenue from it that gives overall cost as per
product line. In context of Oshodi PLC they use marginal costing by producing products and
services in an additional unit of production to get right kind of output.
AC is kind of MAC method in which various kinds of expenses consisted at time of
manufacture goods as per principles of accounting with outside coverage (Guthrie, Ricceri and
Dumay, 2012). There are some kinds of direct costs associated while manufacture a goods and
services by converting them into final products to deliver at ultimate consumer base. In that all
kinds of overhead cost such as utility cost and many more are come under it. In that cost directly
consisted each and every factor that directly includes in producing the product and services.
Marginal costing:
MC of production that bring modifications in cost by bringing production of units to
remain always competitive in market. Major purpose of MC for determine at time scale for that
firm could achieve economies of scale to remain always leading in scenario. The marginal cost
that helpful in production that manufacturers by getting optimum level of production. It is
helpful to producing one additional unit and get revenue from it that gives overall cost as per
product line. In context of Oshodi PLC they use marginal costing by producing products and
services in an additional unit of production to get right kind of output.

⊘ This is a preview!⊘
Do you want full access?
Subscribe today to unlock all pages.

Trusted by 1+ million students worldwide

Total profit using marginal costing method in November and December
November = £ 61,000
December = £ 101,000
= £ 162,000
Oshodi PLC income statement for the Month of November and December using the
absorption costing
Working 1
Normal level of population= 11,000 units
Fixed overhead cost = £ 99,000
Fixed production O/H Absorption = 99,000/11,000 = 9£/ unit.
Therefore Total production cost= Total variation cost+ fixed production O/H
Total variation cost= 25 £
fixed Production cost Absorption= 9 £
Total Production cost/ unit= 34 £
November = £ 61,000
December = £ 101,000
= £ 162,000
Oshodi PLC income statement for the Month of November and December using the
absorption costing
Working 1
Normal level of population= 11,000 units
Fixed overhead cost = £ 99,000
Fixed production O/H Absorption = 99,000/11,000 = 9£/ unit.
Therefore Total production cost= Total variation cost+ fixed production O/H
Total variation cost= 25 £
fixed Production cost Absorption= 9 £
Total Production cost/ unit= 34 £
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser

Less OH
cost Nov Dec
Variable
selling
overhead 50000 60000
Fixed selling
o/H 14000 14000
Fixed admin
O/H 26000 26000
90000 100000
Calculation
of over/
under
absorption
for Oshodi
PLC in
month of
November
and
December
Month Prod. Unit
OH. Abs/
unit
Total OH
Abs OH incurred over/ under
November 12000 9 108000 99000 9000
December 10000 9 90000 99000 9000
cost Nov Dec
Variable
selling
overhead 50000 60000
Fixed selling
o/H 14000 14000
Fixed admin
O/H 26000 26000
90000 100000
Calculation
of over/
under
absorption
for Oshodi
PLC in
month of
November
and
December
Month Prod. Unit
OH. Abs/
unit
Total OH
Abs OH incurred over/ under
November 12000 9 108000 99000 9000
December 10000 9 90000 99000 9000

After calculating the important outcomes from the above mentioned financial statement
that it is very much crucial to get all necessary knowledge and information that helps in taking
important decisions. It gives performance remarks of an organisation by eliminating major loop
falls in a firm.
M2
MA system one of crucial factor for a firm to remain always effective by examining
various kinds of absorption approach, marginal approach and standard costing with many more .
With help of these techniques organisation can be build several kinds of accounting reports such
as income statements, balance sheet and other documents too that helps in taking decisions in an
organisation. With the help of various techniques that are elaborated here:
Standard costing:
SC is important kind of practice which can be get by deducting anticipated cost from the
actualized cost to get right kinds of accounting records (Hiebl and et.al., 2012). Variances are
important to show the records in between the expected with the actual results. In context of
Oshodi PLC by using that techniques they can easily compare the actual cost with the estimated
cost.
Budgetary control:
Budgetary control concerned with state of managers for utilized the budgets by
monitoring and controlling the cost factor for get desirable outcomes . In respective firm Oshodi
PLC by planned income with expenditure of their organisation and after that they allocate the
proper budget as per the requirement.
There are various kinds of management accounting tools available in front of an
organisation that helps to accumulate important kinds of data and information that helps in taking
important kinds of decisions in context of Oshodi PLC. They use financial planning, financial
statement analysis, cost accounting and many more tools to get important kinds of outcomes.
D2
From data and statistics, that should be concluded while observing the financial reports
absorption cost is higher than the marginal cost in month of November. On other hand, marginal
costing is higher in December in comparison to the previous month. For an organisation it is very
that it is very much crucial to get all necessary knowledge and information that helps in taking
important decisions. It gives performance remarks of an organisation by eliminating major loop
falls in a firm.
M2
MA system one of crucial factor for a firm to remain always effective by examining
various kinds of absorption approach, marginal approach and standard costing with many more .
With help of these techniques organisation can be build several kinds of accounting reports such
as income statements, balance sheet and other documents too that helps in taking decisions in an
organisation. With the help of various techniques that are elaborated here:
Standard costing:
SC is important kind of practice which can be get by deducting anticipated cost from the
actualized cost to get right kinds of accounting records (Hiebl and et.al., 2012). Variances are
important to show the records in between the expected with the actual results. In context of
Oshodi PLC by using that techniques they can easily compare the actual cost with the estimated
cost.
Budgetary control:
Budgetary control concerned with state of managers for utilized the budgets by
monitoring and controlling the cost factor for get desirable outcomes . In respective firm Oshodi
PLC by planned income with expenditure of their organisation and after that they allocate the
proper budget as per the requirement.
There are various kinds of management accounting tools available in front of an
organisation that helps to accumulate important kinds of data and information that helps in taking
important kinds of decisions in context of Oshodi PLC. They use financial planning, financial
statement analysis, cost accounting and many more tools to get important kinds of outcomes.
D2
From data and statistics, that should be concluded while observing the financial reports
absorption cost is higher than the marginal cost in month of November. On other hand, marginal
costing is higher in December in comparison to the previous month. For an organisation it is very
⊘ This is a preview!⊘
Do you want full access?
Subscribe today to unlock all pages.

Trusted by 1+ million students worldwide
1 out of 22
Related Documents

Your All-in-One AI-Powered Toolkit for Academic Success.
+13062052269
info@desklib.com
Available 24*7 on WhatsApp / Email
Unlock your academic potential
Copyright © 2020–2025 A2Z Services. All Rights Reserved. Developed and managed by ZUCOL.