ACC3MAC - Performance Management and Control: Assignment Report

This report provides an overview of performance management and control, focusing on how management accounting aids in business decision-making. It details the importance of budgeting and forecasting, and how it helps in analyzing overall business performance. The report includes a case study of a food chain start-up specializing in burgers, detailing cost estimations, sales projections, and the creation of various budgets for effective decision-making. The assignment covers the nature of the business, its purpose, goals, and vision, alongside estimations of direct material and labor costs, variable and fixed overheads, and the creation of a master budget. It emphasizes the application of financial knowledge and skills, particularly in cost calculations and financial reporting using tools like Excel. The conclusion highlights the role of management accounting in business management, emphasizing its use in planning, forecasting, and evaluating employee efficiency through the comparison of budgeted and actual data.

Running head: Performance Management and Control
Performance Management and Control
Name of the Student
Name of the University
Author Note

1Performance Management and Control
Executive Summary
The report includes management accounting details as how it help the company in making the
decision regarding the business objective. It help the company to know the budget and
forecast their future events. It help them to analysis their overall performance in the business.
It also includes details of start-up business of a food chain that has burgers as its main
product. Lastly, the report includes details estimations of various cost and sale of the
company, it also had a details of different budget which the company had to prepare for its
decision making process. It help the company to estimate a profit from the business.

2Performance Management and Control
Table of Contents
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
Nature and Product of the Business.......................................................................................3
Purpose, Goals and Vision of the Company..........................................................................3
Estimation of Standard Direct Material and Direct Labour Costs.........................................4
Estimation of Variable Overheads and Fixed Overheads......................................................4
Master Budget of the Company.............................................................................................5
Reflection of the Assignment.................................................................................................7
Conclusion..................................................................................................................................7
Bibliography...............................................................................................................................8

3Performance Management and Control
Introduction
Management accounting is a process from which the management ascertain
the cost of their products. It help the management to budget their cost and sale
figure for upcoming business and it also help them to forecast their profit and make
strategies regarding the same. It help the company for planning their business goals
and help them to take decision regarding the goals. It help them to judge their
performance as they can compare the actual data with the budgeted data and then
company can do change their system so that it can minimize the loss which were
happen early in the manufacturing unit.
Discussion
Nature and Product of the Business
The business structure of the company will be a fast food business and the
product that it will be offering is Burgers. As this business is been select as it involve
less amount of capital to start and not much of experience is need to start the
business. Even the company can get sale of its product at start up, as food is the
only industry where generating sales is easy compare to any other business
structure.
Purpose, Goals and Vision of the Company
The purpose of the company is to sale their products in the local market of
Australia and to earn huge profits for the company. It want sell the product in local
market as it is a start-up business so it does not have any brand value so if it will
sale its product in the local market. It will be able to make a name in the market and
it will able to get more sale in local market as the environment there have large
number of customers.

4Performance Management and Control
The goals of the company is to maintained a proper brand value in the market
and to make its own brand it started its sale at local markets of the Australia. The
goal of the company is to make a change in the food industry by providing good
quality of food in standard rates.
The vision of the company to expand it as in series of food chain. It want to
make similar food chain all over the country. It vision having an expanding strategy
of similar food chain, it started its business in the local market but it will make its
business run all over the country. Company had a vision of 5 years that in 5 years it
will have a series of food chains all over the country. It is expecting that within 2
years, it will have at least 10 shops and at the end of 5 years, it will have 100 shops
all over the country.
Estimation of Standard Direct Material and Direct Labour Costs
The company has expected that it will produced 3000 Burgers in a month as it
considering that in each day it will able to sale 500 burgers so in 30 days it will able
to sale (30*500)= 15000 burgers. The Estimated Cost of Direct Material will be $1 as
per the industry norms and the objective of the company is to deliver quality product
at low cost. The Estimated Cost of Direct labour will be as it is a start-up business so
it will start with 2 labour which will work for 8 hrs in a day at a per basic of $10 as it is
a start-up business so the company had to get cheap labour for the product.
Estimation of Variable Overheads and Fixed Overheads
Variable overheads are those cost, which changes with change in the
production output. Such cost in company are as indirect materials and indirect
labour, which can estimated as $500 it includes additional material like packing of
the product.

5Performance Management and Control
Fixed overheads are those cost, which fixed in nature and does not change
with change in output. It includes cost such as rent of the shop and electricity cost.
This is been estimated as $5000 and includes all the fixed cost of the company.
Master Budget of the Company
Master Budget is a budget, which help the company to forecast their future
profits. It includes many small budgets, which help the company to decision-making
process. The budgets, which includes are Material Budget, Production Budget and
Sales Budget.
Raw Material Budget of the company
Table No – 1
Source – Author
This budget shows how much the company needs raw material for its monthly
production.
Purchase Material Budget of the company
Table No – 2
Source - Author

6Performance Management and Control
This budget show how much purchase of raw materials and the total cost of the
company.
Sales Budget of the company
Table No – 3
Source - Author
This budget show how much the company can earn from the selling of the product
Cash Budget of the company
Table No – 4
Source – Author
This budget show how much the company had received cash from selling the
product in the market.

7Performance Management and Control
Reflection of the Assignment
From the above assignment, I have learned many knowledge and skills. The
knowledge that I have gain from doing the assignment is about financial aspects of the
business, cost aspects of the business. It also help to know the various cost details in the
company like Direct Material Cost and Direct labour cost. This assignment helped me in
knowing the various section and parts of the cost that lies in a business structure. The skills
that I able to get from the assignment is to know how to do calculations of cost. It help me to
know the calculations of cost, and how to put that calculation in excel format. This
assignment helped me to know the basic of excel, and how to use it in calculations.
Conclusion
The report concludes, as the management accounting is the base, which help
the company to manage and take decision regarding its business. It help the
company to budget and forecast data related to the future events of the company. It
also help them to judge the efficiency of the employees as it can compare the budget
data with actual data and can know where they have to put more efforts in the
business operation.
Lastly, the report concludes about a start-up company which is food industry
and it offer burger as it products. The report includes its estimation of direct material
cost and direct labour cost. It also includes the estimation of variable overheads and
fixed overheads. The master budget is also prepared on the budgeted data and from
which the company can make its business decision.

8Performance Management and Control
Bibliography
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firm performance: The incremental contribution of lean management
accounting practices. Journal of Operations Management, 32(7-8), 414-428.
Gao, S., Chen, W., & Shi, L. (2017). A new budget allocation framework for the
expected opportunity cost. Operations Research, 65(3), 787-803.
Hansen, D., & Mowen, M. (2014). Cornerstones of cost management. Nelson
Education.
Hopper, T., & Bui, B. (2016). Has management accounting research been
critical?. Management Accounting Research, 31, 10-30.
Lavia López, O., & Hiebl, M. R. (2014). Management accounting in small and
medium-sized enterprises: current knowledge and avenues for further
research. Journal of Management Accounting Research, 27(1), 81-119.
Maas, K., Schaltegger, S., & Crutzen, N. (2016). Integrating corporate sustainability
assessment, management accounting, control, and reporting. Journal of
Cleaner Production, 136, 237-248.
Newcomer, K. E., Hatry, H. P., & Wholey, J. S. (2015). Cost-effectiveness and cost-
benefit analysis. Handbook of practical program evaluation, 636.
Shields, M. D. (2015). Established management accounting knowledge. Journal of
Management Accounting Research, 27(1), 123-132.