Management Accounting Report: Methods, Costs, and Planning Tools

This report provides a comprehensive overview of management accounting principles and practices. It begins with an introduction to management accounting and its different systems, specifically focusing on job costing, price optimizing, inventory management, and cost accounting. The report then delves into various management accounting methods, including account receivable reports, budgeting reports, performance reports, and inventory and manufacturing reports. A significant portion of the report is dedicated to cost determination using methods like cost examination and the development of income statements, along with a comparison of marginal and absorption costs. Furthermore, it discusses the advantages and disadvantages of different planning tools used in budgetary control, such as flexible budgets and master budgets. The report concludes with a comparative analysis of enterprises to effectively manage management accounting functions and solve financial problems. The report is based on a case study of Pearl Chartered Accountants, a UK-based accounting consultancy, to illustrate the practical application of these concepts.

Management Accounting

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................4
P1) Explain management accounting and different kinds of management accounting system.. 4
P2) Examine the various method of management accounting. ..................................................5
TASK 2............................................................................................................................................6
P3) Determine the cost with the help of various methods such as cost examination and
developing income statement, marginal and absorption costs....................................................6
TASK 3..........................................................................................................................................12
P4) Discuss the advantages and disadvantage of different kinds of planning tool in order to
budgetary control......................................................................................................................12
TASK 4..........................................................................................................................................15
P5) Comparison between enterprises in order to effectively managing the function of
management accounting in order to solve the financial problems............................................15
CONCLUSION..............................................................................................................................18
REFERENCES..............................................................................................................................19

INTRODUCTION
Management accounting is process which refers to organisation effectively recording
transaction as well as estimate cost and expenditure in order to find out the proper result which
are helpful to achieving organisation goal and objectives. It is method and process which refers
to manager properly implementing this strategies due to enhancing profitability and productivity.
It considered as various tool and techniques which are effectively applied due to enhancing
profitability and productivity (Alawattage and et. al., 2018). The report is Pearl Chartered
Accountants which refers to organisation are situated in UK as well as managing business
operation effectively and efficiently. The paper consist is management accounting system,
method as well as comparison between the organisation in order to effectively managing
management system and adapting various techniques in order to smoothly operating business
activity and operations. It involves various tools such as performance, account receivables,
inventory, budget report and so on.
TASK 1
P1) Explain management accounting and different kinds of management accounting system.
It is process which refers to effectively conducting management accounting activity and
task in order to managers taking effective decision which ar4e helpful to attained organisation
goal and objectives. It involves managerial accounting in order to identify, analysing,
communication due to workforce effectively conducting financial accounting system within
organisation. It includes management accounting is process in order to developing financial
report and maintain proper transaction and entries which are used by financial department as well
as properly allocated resources (Baghoumian and et. al., 2017). In context of Pearl Chartered
Accountant, it is an accounting consultancy organisation in UK which are advice to many other
services in order to effectively developing management accounting department in order to
effectively accomplishing organisation goal and objectives. It is essential to each and every
business model in order to maintaining profit, financial statement and balance sheet which are
helpful for managers in order to making effective decision as well as smoothly run the business
functions. There are various management accounting system which are used by an organisation
so discussed below.

Job coasting system-: It is system which refers to organisation analysis the need of
particular product and service and the manufactured. In relevance of organisation, accountant
costing of each product and services and accordingly allocate resources effectively and
efficiently. In costing procedure involves the various elements such as receive enquiry about
product from client, price, order received, cost recorded and so on. It is helpful to developing
final report and financial statement which are providing by accountant. The main advantage of
this system which refers to evaluating need and demand of customers accordingly developing
products on the basis of cost.
Price optimising system-: It considered as effectively analysis prices of products and
each product has set different price due to fluctuation in demand and market situation. It is
essential to an organisation to control the price of product because customers are influencing in
the price of product and set accordingly (Daryanto, 2019). It is effective tool and techniques for
organisation in order to maintain adequate price of product in the marketplace.
Inventory management system-: It is system which refers to monitoring asset and stock
of company in order to properly used by organisation. In management accountability various
method are used in this system such as EOQ, JIT approach, ABC analysis and many more. All
this techniques are effectively implemented in order to maintaining the stock of inventory as well
a smoothly run the business activity and functions. Organisation effectively managing inventory
system sue to reduce cost and properly storage the stock.
Cost accounting system-: It is management system which refers to analysed the price of
product and services because it is beneficial for organisation in order to enhancing profitability
and productivity (Hertat and et. al., 2019). It is process which refers to effectively job order
costing as well as estimate of cost of goods and service because team members work in proper
coordination and collaboration. In reference of Pearl Chartered Accountants, it effectively apply
this system organisation analysis cost of product and services.
Hence, it includes all the accounting management system which refers to Pearl Chartered
Accountants are applied effectively and efficiently in order to their managers taking effective
decision regarding operations of business. It is process which majorly focusing on enhancing
profitability and productivity of an organisation. It includes various information due to proper
allocation of resources as well as managing internal management and determine price of product.

P2) Examine the various method of management accounting.
It considered as organisation developing proper management accounting report because
record the proper transaction and entries which are helpful to smoothly run the business activity.
It is essential to organisation to developing financial report because organisation compare
previous report with next year and accordingly used resources. It is necessary for business model
to collection of information so accordingly taking decision of investment and achieving higher
rate of return (Holm and et. al., 2020). In context of organisation, it is essential to accounting
department in order to utilised data in proper manner. There are various accounting method
which are mentioned below.
Account receivable report-: It is report which are preparing by an organisation in order to
received the amount from debtors and effectively managing account receivable account. It
includes separation of customer invoice bill and organisation credit policy effectively. In context
of organisation, it involves properly arranging account receivable because sustain and survive in
the market.
Budgeting report-: It is another method which are used by an organisation in order to
effectively run the business as well as estimate budget in order to know about the revenue and
cost of company. It is budget preparing to estimate the expanses of previous year accordingly
think to expand the business operation and functions. It includes various tool and techniques
which are providing reward to employees due to organisation are financial sound as well as
given bonus. It is necessary fop organisation in order to motivating and encouraging employees
as well as achieving financial goal and objectives.
Performance report-: It is method of accounting management which refers to
organisation set the criteria and standard on the basis of evaluating financial performance of
company which refers to compare the actual performance with set criteria (Huyen and et. al.,
2020). It is focusing on make comparison different basis such as monthly, quarterly and yearly.
Inventory and manufacturing report-: It includes organisation maintaining inventory
and stock effectively and efficiently which refers to overhead, labour cost and many more. It is
essential to managing assembly line due to improving product and service which refers to
providing opportunity in order to enhancing profitability and productivity of company.
Advantages of implementing accounting system with reporting:

It includes management accounting and reporting effectively implementing due to properly
collection of information and effectively developing report which refers to achieving
organisation goal and objectives. It is process which refers to improving function and activity in
order to effectively run the business operations and accountability, better consistency as well as
minimizing redundancies.
TASK 2
P3) Determine the cost with the help of various methods such as cost examination and
developing income statement, marginal and absorption costs.
Income statement-: It includes organisation developing financial statements due to
managing profit and loss of company (Kumarasiri, 2017). It is statements which refers to
providing all the information regarding finance within specific period of time. It is tool and
techniques which are helpful to attained organisation goal and objectives as well as make
financial sound and position. It is tool which refers to organisation utilisation various tool and
technique in order to performing business function by employees. It considered as statement
which refers to developing financial statement managing account properly as well as calculating
revenue with the help of matching concept. It considered as various expanses and balance sheet
developing within specific period of time as well as concluding profitability position of
company.
Absorption cost-: It is another tool and method which refers to managing accounting cost
because it incurred on manufacturing product and services. It is cost which refers to adding
variable cost and fixed cost due to fixed overhead of each units in order to goods manufactur8ing
within period of time. It involves various costing techniques due to effectively implementing in
order to managing inventory and properly costing of stock (Mahmoudian and et. al., 2020). It is
process which refers to fixed charges are impact on particular product and valuation of
inventory. It is tool which refers to used various approaches in order to absorption costing
method due to tracking manufacturing product and profitability.

Preparation of income statement through absorption and marginal costing of Connect
Catering Services are as follows:

TASK 3
P4) Discuss the advantages and disadvantage of different kinds of planning tool in order to
budgetary control.
There are various method and approaches which are effectively planning budgetary
control method and process. It is important function in order to organisation effectively applied
tool and techniques which refers to developing budget in order to achieving organisation goal
and objectives. It is process which refers to estimation of cost and expanses due to effectively
enhancing profitability and productivity (Ostaev and et. al., 2019). It is important method in
order to effectively performing business activity as well as estimation cost and expanses in order
to managing business activity and task. There are various kind of approach and method which
are effectively implementing by Pearl Chartered Accountants so discussed below.

Budget-: It is process which refers to financial statement developing proper estimation of
cost, revenue, sales, profitability and expanses in order to attained within period of time. It is
important process which refers to effectively managing internal management and to measure
actual performance with the set standard (Pelz, 2019). Budgetary control is techniques which are
effectively determination of sales and accordingly budget he figures within period of time. It
considered as proper calculation of budget which are mentioned below.
Flexible budget-: It is tool and techniques which effectively used in budgetary control
and properly measured the activity and task of an organisation. In relevance of organisation, it
includes properly monitoring and controlling sales due to effectively measures the standard sales
within the specific period of time.
Benefits-: It is budget which are helpful to measuring the required level of production. In
this budget developing sales as well as generating more revenue due to organisation survive and
sustain in the market for longer period of time as well as reducing inventory cost.
Limitation-: It includes organisation hiring and recruiting trained employees in order to
effectively managing business activity and operations. Flexible budget is not effective applied in
order to financial sound as well as organisation incurred heavy cost due to trained employees.
Master budget-: It is tool which refers to conducting budget as well as divisional budget
and make combination on single department. It considered as proper financial planning, cash
forecasting, budgeting statements and many more (Suomala and et. al., 2017). In context of
Pearl Chartered Accountants, it involves developing budget on specific period of time for
financial year.
Benefits-: It is budget which refers to managing information and activity in order record
estimation of expanses and revenue for functions and activity. It considered as summarises all
the budget activity in order to developing proper budget.
Limitation-: The main disadvantage of this budget which refers to developing various
changes in order to meeting all the budget requirement and activity. It is essential to developing
changes and directly impact on organisation profitability and productivity. It is essential to
managing financial statements and activity due to attained organisation goal and objectives.
Capital budgeting-: It includes organisation developing proposal of investment in order
to accomplishing specific activity and task. It considered as organisation focusing on various
financial task in order to purchasing plant, machinery in order to take effective decision