Management Accounting Report: Analysis of Zylla Company Operations

This report provides a comprehensive overview of management accounting principles and their application within the context of Zylla Company. It begins with an introduction to various types of management accounting and their significance in business operations, emphasizing their role in guiding decision-making, optimizing resource allocation, and achieving organizational goals. The report then delves into different reporting systems used in accounting management, highlighting their importance in providing accurate financial information to both internal and external stakeholders, including investors. Furthermore, the report explores various costing methods considered in management accounting, such as cost accounting, inventory management, and job costing, analyzing their impact on cost control and efficiency. It also examines the advantages and disadvantages of planning methods, particularly in relation to budgetary control, and concludes with a comparison of Zylla Company's financial performance with that of other firms, addressing potential financial issues and challenges. The report aims to provide a thorough understanding of management accounting and its practical application in a business setting.

Management
Accounting

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Various types of management accounting and its important use...........................................1
P2 Different reporting systems used in accounting management...............................................3
TASK 2............................................................................................................................................5
P3 Few costing methods considered in management accounting...............................................5
TASK 3............................................................................................................................................8
P4 Advantages and disadvantages of planning methods.............................................................8
TASK 4..........................................................................................................................................10
P5 Comparing with another firms regarding financial problems and issues............................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Management is that procedure where each and every firm of an enterprise can be
organised and managed in proper manner. This related with management accounting and many
other major factors. It is one of the essential part of any business enterprise which help in smooth
running of business operations for small or large organisation. It assist the firm for gaining future
growth and success in future time period. This is that methods and techniques which provides
accounting data or information for performing different functions such as encouraging,
motivating and planning for making correct decision. In an enterprise, there are different
financial dealings which should be recorded on daily basis which require some system that help
management in recording information in correct format (Fullerton, Kennedy and Widener, 2014).
The report is based on Zylla company which provide effective services to their customers. In this
project, there are several advantages and disadvantages for using planning techniques which
totally linked with budgetary control.
TASK 1
P1 Various types of management accounting and its important use
Management accounting refers to that process where business operations and functions
help in managing and controlling all major factors. This assist in examining and recording all
business operations for internal firm use which directly affect on maximise the efficiency and
productiveness. Accounting manager use such provision of getting correct accounting
information to inform better and by this they easily achieve towards desired goals and targets for
an organisation.
Management accounting is that procedure which help in designing and preparing
different financial accounts and reports to get correct and reliable financial or statistical data that
are need by company manager for making these type of decisions. This will assist the managers
for getting short and long term goals for an organisation (Renz and Herman, 2016). This will
gather information about any accounting form which enables Zylla firm can operate its functions
in more effective and efficient way in regular time period. This will give important information
or data for an enterprise for maintaining good position within the firm. This includes entries,
ledgers and budgets for the company. Such things are taken into determining and developing
financial statement in proper way. This is also called as primary factor which help in guiding
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mangers for doing correct work in order to determine company's total sales volume, accounting
payables and receivables in effective manner. An organisation accountant required such data or
information while evaluating employee performance so it is important for making correct
decisions that has to be done. On the other hand, all these accounting information is crucial for
company managers which are capable for making such ideas regarding financial status of the
Zylla firm and also take corrective actions for investing the capital.
This can also affect the profitability of business, if such data or information is not
described in appropriate manner (Otley, 2016). By using such accounting system, various issues
or problems can occurs in the business operations and try to solve these hurdles. Also major
issues can be corrected in fast period of time so this can not effect on productivity of an
organisation. It has been analysed that there is large burden for managing financial records
related to Zylla firm due to large scale of business operations in effective way. It can occurs for
some of the business enterprise which are related to public and private sector.
Zylla company efficiency can be maintained at one cost which mainly use the correct
techniques and methods for providing high chance for gaining major opportunities. Decision
making should be made for the betterment of company activities. In this report, it is clearly
mentioned that they require to analyse and record different functions which performed by an
organisation. Another is net profitability and growth which can majorly relies on getting accurate
result or outcome that are collected for using accounting systems.
Importance of management accounting: Assist in attaining team objectives- With the help of accounting system, this will arrange
the production factors, organised and assemble certain resources for getting organisation
goals and targets in proper manner. Optimal usage of resources- Such physical and human resources are used at the time of
production process that can be utilise in better manner and they can get best possible
outcome in reasonable rate.
Types of accounting system:
Price optimisation system- It is specific system which consist of making important
decisions which associated with different prices of every products that developed by an
enterprise. It is used for determining customers views and reviews regarding cost of each goods.
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In Zylla organisation, they can predicted set prices which assist in attaining maximum profit and
reach desired targets and goals.
Cost accounting system- In this system, the major duty and role of accounting managers
is to monitoring and controlling the business operations and analyse the cost of specific
manufactured procedure (Hiebl, 2014). The effective system help in evaluating cost of actual
sales and analysing inventory costs. These type of concept will minimise the wastage where cost
can be managed and controlled.
Inventory management system- It assist in effectively supervise the non-capitalised
assets and stock goods. This help in control all such functions and activities that can manage
production with sales. Zylla firm provides correct data or information about new products to
their customers in the large market place.
Job costing system- This is necessary to track company workers cost while production
procedures. The overhead cost obtain while manufacturing large number of specific products and
services. Basically, the cost directly affects that situation where goods are formulated which are
different from other company products.
P2 Different reporting systems used in accounting management
The management reporting is the systematic procedure which render the information for
particular stage of administration so they can change for analysing the actual responsibility
centre. This will became perfect base for taking accurate actions which is essential for an
organisation. For formulating and developing accounting practices, it is important for making
growth in the business. The accounting management differ from financial accounting so they will
develop reports for Zylla company to their internal and external stakeholders. In an enterprise, it
is important for manager is do work for getting correct result or outcome and gain positive
aspects. Another is growth and success is one of the primary part for such accounting managers
in effective manner (Quinn, 2014). By this, they use managed and organised reporting system
which assist them in maintaining and recording daily transactions. This is useful for accountant
manager is to make correct decision for the betterment of the company. This report is taking all
such information that can collected from each department of an organisation such as financial,
marketing, human resource etc. Whole data and information should be transfer into business
statement in proper manner. Zylla company investors can examine all such statements and
reports for making critical decision procedure.
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The future stability and development mainly relies for such statements that can be
prepared and designed by using information for each section. It has been observed that data will
be collected for report taken from financial and non-financial sources. This is necessary for Zylla
firm for evaluating accounting data for getting positive outcome. Effective data should be
collected from recording such financial information by the help of stakeholders (Tucker and
Parker, 2014). They also use different statements that includes cash flow statements, balance
sheet and income statements. They need to do analysis for making accurate investment plans and
policies.
The main motive of the company is to get maximum return with the help of making
investment in company projects. Report is required for increasing future success and growth
opportunities for analysing their actual profitability cost. This is totally related with various
financial activities and perform transaction by Zylla firm within one year. In this context, correct
strategy should be develop for enhancing products image and maintain reputation of the
organisation so they can gain attention of large number of customers towards their services. Also
there is separate factor which help in earning maximum benefits from other rivals which are
doing same type of business. It is one of the effective technique and method by which accurate
result can be generated with the help of limited resources. The main objective of using these type
of reporting system is to determine the actual position of company in compare with another firm.
An organisation required to achieve long term goals by using reporting system method.
Importance of reporting system: Role of control system- Zylla firm will set all the major goals and objectives in effective
manner. The role and responsibility of company manager is to set desired goals and
targets with the help of employees (Suomala, Lyly-Yrjänäinen and Lukka, 2014). Report
are designed for measuring the actual performance of workers for targetting budgets. Useful in profitable operations- The project have to show the actual direction for moving
towards business operations and major functions. Management can provide different
information and data so they will gain extra profitability to their expected workers.
Types of reporting system:
Account receivable report- In this reporting system, information are related with lists of
unpaid customers and mentioned bills according to this. The main objective of this methods and
techniques is to analyse whole payback time period for outstanding debts cost.
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Job costing report- This report is accompanying with total cost that are totally related
with production of total units manufactured at the given time period. It involves labours,
materiality and expenses which are used in this report system (Cooper, Ezzamel and Qu, 2017).
The main motive of this reporting is to recognise total cost which incur by firm for getting
particular products size and price.
Performance reporting system- As per this system, financial statements can be analysed
in that manner so they can represent employees as well as organisation performance. By taking
correct decision making for the company betterment so they require to make performance report
at the ending year. This includes analysing accounting information of Zylla firm and there are
various employees who work there. Evaluation can be done by taking correct information from
previous and current years.
Inventory management report- This is essential system of reporting which can be used
for determine major objective to manage and control all stocks of an organisation. There are
different methods and techniques which can directly affect on business operations such as
Inventory turnover ratio, ABC costing and EOQ tools.
Operating budget- It is the reporting system which mainly associated with cost of
production that linked with revenue and expenses of Zylla firm within the year. The main goal
for use these type of reports is to determine actual cost that has to be incur by company while
producing some additional units. There are different sources for analysing operating expenses
that includes production budget, sales budget and many other.
TASK 2
P3 Few costing methods considered in management accounting
Cost: This is one of most paramount elements also known as amount that a company
incur for merchandising service and products (Maas, Schaltegger and Crutzen, 2016). This is
valuation of monetary of whole material, utility, resource, efforts and risk occurred in the
product delivery in company.
Costing is the entire cost estimation that is related with the certain venture or product.
This consist of various cost variable that are called as cost which changes with the activities
forms. This can be considered as major part, indirect and direct costing. Generally, this is linked
as the price which can easily be analysed with the term of finance. This summon several
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different resources opted by organisation manager while product transaction to clients or
consumer. Such cost kinds are efficient or effective while making the future plans or decisions.
Some of the methods of costing. That is linked with the respected company, Zylla, in setting the
company profitability. Here are explained some of methods of costing:
Absorption Costing: The cost associated with the product and service production, is
considered as the absorption cost (Messner, 2016). This include cost of variable along with the
fixed cost sometimes. Such methods is utilised for the calculation purpose of service and
products through considering the direct and indirect overhead into account.
Marginal Costing: This defines the extra unit production cost which incur in the
organisation. If the per unit charge is higher than the cost of margin of producing extra product
units, then this is beneficial for enterprise to manufacture that service or product units.
COMPARISON
Absorption costing Marginal costing
According to this costing, the cost which is
rendered by Zylla, can easily be evaluated as
the total amount which is utilised at the time of
production.
Only the cost of margin are being utilised
while production process.
The major profits of optimising this techniques
is, it can aid in decline in per unit cost along
with additional units.
Per units contribution will not be affected that
much with advance units.
This is linked with organisation for costing and
long term planning.
This can considered as the short-term planing
along with high management system.
This is less effective techniques when it comes
to better decision making.
Most companies use this techniques for making
essential decision making of the enterprise so
as Zylla company.
Sustainability rely on the reporting system's
external aspects.
This is related with the system of reporting for
the profitability and development of
organisation.
Calculation of profit by using absorption costing technique
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Particulars Calculation Amount
Sales 52500
Less: cost of goods sold (W/N 1)
Cost of opening inventory
Direct labour -7500
Direct material -12000
Variable production overheads -3000
Fixed overheads -7500
Less: cost of closing inventory -10000 -40000
Profit before deduction fixed
overheads and selling and
distribution expenses 12500
Less: Fixed production overheads -15000
-2500
Less: selling and distribution
expense
fixed overheads -10000
variable overheads -7875
Net profit or loss -20375
Calculation of profit by using marginal costing technique
Particulars Amount
Sales 52500
Less: cost of goods sold
Cost of opening inventory
Direct labour -7500
Direct material -12000
Variable production overheads -3000
Less: cost of closing inventory -7500 -30000
Profit before selling and distribution expenses 22500
Less: selling and distribution expense
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variable overheads -7875
Net profit or loss 14625
Working Notes:
1. Calculation of cost of goods sold under absorbtion costing technique
Particulars Details Amount
Cost of opening inventory -
Direct labour (1500* 5) 7500
Direct material (1500*8) 12000
Variable production overheads (1500*2) 3000
Fixed overheads (1500*5) 7500
Less: cost of closing inventory (500*20) 10000
Cost of goods sold 40000
2. Calculation of selling and distribution expenses
Particulars Details Amount
fixed overheads 10000
variable overheads (52500*15%) 7875
Total selling and distribution expenses 17875
3. Calculation of cost of goods sold under marginal costing technique
Particulars Details Amount
Cost of opening inventory -
Direct labour (1500* 5) 7500
Direct material (1500*8) 12000
Variable production overheads (1500*2) 3000
Less: cost of closing inventory (500*15) 7500
Cost of goods sold 30000
TASK 3
P4 Advantages and disadvantages of planning methods
Budget- It is called as planned and detailed information for specific time period for doing
business operations and its major functions. This will determine expenditure and price where
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firm require for making desired products and services in proper manner. This can termed as
broad designing of business operations and accounting planning for identify the actual gap.
Basically, it is prepared for more than one year and does not follow major results which are not
in favour of an organisation.
Budgetary control- This can be defined that it is important method and tool which
directly affect management for carry out its business operations such as analysing, planning and
coordinating in effective manner (Klychova and et. al., 2015). It is associated with different parts
of business which is divided into several sections that is known as budget.
Process of budgetary control: Enquire with concern managers- It is necessary for company manager is to make proper
analysis for taking accurate information from each other. They need various budgets for
controlling and managing their effective cost and expenditure. This will assist them for
communicating correct data for betterment of Zylla company. Done effective predictions- For collecting feedback from company managers they require
to make and create anticipation for protect with coming losses. The main aim of planning
budget is to manage and control all future activities and major functions. This will consist
different expenses which are going for incurred by an organisation. Fixed company data associate to budget for accomplish desired goals- In this
procedure, proper list of elaborated information for taking into desired data which should
be accumulated from different departments. It help company manager for making right
planning according to the set regulation. Computation of data with budgeted- Zylla firm performance have to measure by actual
information and data for comparing with company budgets (Bovens, Goodin and
Schillemans, 2014). It will assist them for predicting possibility of growth and success
with desired resources. Review analysis- This is final stage of budgetary control process, company managers
mentioned such steps which must be followed in right direction. Sometime, everything is
going proper then it will transfer to high authority for other approvals in proper manner.
 Planning methods- In an enterprise, planning define the management methods which are
related to measure the organisation upcoming direction and prediction of mission and
vision for gaining maximum profitability. For measuring goals, company managers used
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for formulating and developing planning and other planning methods. These tools are
described as under:
Prediction tool- This is very effective and useful method for analysing future activities
and functions on the basis of management knowledge, skills and abilities (Modell, 2014). It is
useful data and information for determining major direction of future trends.
Advantages:
This is necessary for company for determining major goals and objectives. For this,
company managers can estimated the total cost and sales for coming time period.
Disadvantage:
It can not develop correct prediction of company total expenses that should be incur by
an organisation.
Scenario methods- In this specific tool, company manager can usage it for evaluating
various choice according to the demand of situation. It help in planning, managing, controlling
and operating management of Zylla company in effective way.
Advantages:
By the use of such methods, organisation managers can get accurate ideas regarding
selection, opportunities and implementation can be definite.
Disadvantage:
This is not correct and right for an organisation. Also it will take more time as compared
with another firm services.
Contingency planning tools- This will define the planning method which has been
develop for company to interact in proper manner for managing critical conditions. In emerging
the contingency planning, it consist for making analysing of management which includes
financial and human resource department.
Advantages:
This will assist in reducing the cost of amount so they can easily decreased the cost. It
can help in gaining maximum profit for the company.
Disadvantage:
In some conditions, it is major complicated plan because of their difficult nature.
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TASK 4
P5 Comparing ways in which organisation can apply management accounting to financial issues
In an enterprise, it has been determined that firm has to face different financial issues
which occurs at the time of financial year. This can be associated with investing, financing and
operational activities. Another major financial issues can be occurs for using effective method
for recording transactions. There are various tools and methods which are helpful in measuring
accurate result that are based on effective financial terms. Budgetary control process should be
described a effective technique which can affect the management and controlling for entire
business operations and functions of an organisation. Zylla firm used in this for support in
impressively control on outflow and inflow of cost that are used for gaining profitability.
KPI- The key performance indicators define more helpful technique which can used for
measuring company performance of an organisation as well as person (Advanced Management
Accounting. 2017).
Benchmarking- This is called as that system where company management can fixed their
standard results which make proper relation with their operational teams and groups.
Financial governance- This is that term which help in determining authorities rules and
regulations that can assist in smooth running of business operations and its major functions.
There are various characteristics of information required for decision making that are as under: Forward looking – It is necessary for firm is to look forward and analyse the main
motive to think about future ideas and thoughts in better manner. While making decision,
it is required for company is to predicting future terms and conditions. Probability testing – It is another method which can be used for making accurate
decisions where they can select one alternative among others. Opportunity costs – This will define that advantages where an individual can received for
taking actions and activities. This is another cost which make decisions at the time of
analysing appropriate cost system and policies in better manner. Relevant costs – It is the nature of decision making process where the company can
describe accessible costs which occurred while taking appropriate business decisions. Net cash flow – This will define the differences between company cash inflows and
outflows in given time frame.
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 Data availability – It is that term which can be used when some computer storage
producers and storage services given effective goods and services which make sure that
data continue to be available at required level. One off – This is one that something unique and creative things that can be analysed in
better manner.
Zylla company Unicorn grocery
The firm help in performing their operations
for large scale organisation so they require for
maintain KPI for determine their financial
performance.
In this. SMART method is one of the important
tool which is more effective for managing and
controlling whole business operations.
An organisation is associated with
improvement and development of grocery
products and services. So they have to require
control for managing various operational
levels.
Financial administration should be
implemented in this firm by which they suffer
from high loss.
CONCLUSION
As per the above mentioned report it can be analysed that Management is that procedure
where each and every firm of an enterprise can be organised and managed in proper manner.
This related with management accounting and many other major factors. An organisation
accountant required such data or information while evaluating employee performance so it is
important for making correct decisions that has to be done. For formulating and developing
accounting practices, it is important for making growth in the business. In an enterprise, it has
been determined that firm has to face different financial issues which occurs at the time of
financial year. This can be associated with investing, financing and operational activities.
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REFERENCES
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accounting. Accounting and Business Research. 44(2). pp.104-143.
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management accounting, control, and reporting. Journal of Cleaner Production. 136.
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Messner, M., 2016. Does industry matter? How industry context shapes management accounting
practice. Management Accounting Research. 31. pp.103-111.
Klychova, G. S. and et. al., 2015. Management aspects of production cost accounting in horse
breeding. Asian Social Science. 11(11). p.308.
Bovens, M., Goodin, R.E. and Schillemans, T. eds., 2014. The Oxford handbook public
accountability. Oxford University Press.
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Online
Advanced Management Accounting. 2017.[Online]. Available through:
<http://www.bristol.ac.uk/efm/courses/undergraduate/units/level3units/
efim30003.htm>.
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