Unit Number and Title

Unit 5: Management Accounting (Level 4)

Unit Code (RQF Level)

Student Name/ID

Academic Year

2018-19

Assignment Title

Management Accounting in Decision Making

Unit Assessor

Issue Date

04 February 2019

Submission Date

Internal Verifier

Date

Submission Format/Guidance

The written report is to demonstrate an understanding of management accounting You are required to present the report in a professional way. Your research should be referenced using the Harvard referencing system.

Structure of written report

Title Page :

Table of contents :

Main body:

·        Definition of management accounting

·        Essential requirements of different types of management accounting systems.

·        Different methods used for reporting management accounting

·        The benefits of management accounting systems.

·        Difference between management accounting and financial accounting

·        The integration of management accounting systems and management accounting reporting

Conclusion:

References:

Task 2: Scenario 2 : Spreadsheet working [ MS Excel ] embedded on Report

             Scenario 3 : Written Report

·      Your work must be in Microsoft Word format

·      You should present your wokusing black text only (not in colour text which are ineligible)

·      Your submission must be uploaded to ‘‘Fairfield Connect’’ portal for this subject – MA

LO2: Apply a range of management accounting techniques.

LO3: Explain the use of planning tools used in management accounting.

LO4: Compare ways in which organisations could use management accounting to respond to financial problems.

Easy Seat Ltd is a manufacturer of portable chairs to be sold at vantage points within cities throughout the UK. You have been appointed to the position of Assistant Management Accountant reporting to the Management Accounts Manager. You have been invited to a management meeting at the end of the month to present a report on a range of issues that borders on the importance of management accounting in decision making.

LO1: Demonstrate an understanding of management accounting systems

Explain Management Accounting and give the essential requirement of different types of management accounting systems and explain the different methods used for management accounting reporting. Briefly bring out the difference between Financial Accounting and Management Accounting.

Further, evaluate the benefits of management accounting systems and their application within Easy Seat Ltd. And critically evaluate how management accounting systems and management accounting reporting is integrated within organisational processes.

As a Management Accounts Assistant, apply a range of management accounting techniques of cost to analyse and prepare income statements using different methods.

Easy Seat Ltd makes and sells one product, which has the following standard production cost.

Normal output is 16,000 units per annum. Variable selling, distribution and administration costs are 20 per cent of sales value. Fixed costs are £180,000 per annum. There are no units in finished goods stock at 1 July 2018. The fixed overhead expenditure is spread evenly throughout the year. The selling price per unit is £140.

Production and sales budgets are as follows.

LO2 Apply a range of management accounting techniques

Prepare on a spreadsheet [MS Excel] profit statements for each of the six-monthly periods, using the Absorption Costing and Marginal Costing methods.

Reconcile the Net Operating Profit from the two Income Statements and discuss the reason(s) for the difference in the profit.

Produce a financial report that accurately use the data from above and interpret this data for a range of business activities at Easy Ltd.

Task 3

Scenario 3

There are twenty-five employees and annual sales revenue is approximately £2m per year. As Management Accounts Assistant of Easy Seat Ltd; you are required to produce a report considering the different planning tools that could be used to aid forecasting and budgetary control.

Lately, Easy Seat Ltd has run into some cash flow problems. You have been advised to suggest  how planning tools such as budgeting can be used to ease out the liquidity problem at Easy Seat Ltd.

LO3: Explain the use of planning tools used in management accounting.

Explain the advantages and disadvantages of budget and budgetary control as a planning tool. Further, analyse the use of different planning tools and their application for preparing and forecasting budgets for Easy Seat Ltd

LO4: Compare ways in which organisations could use management accounting to respond to financial problems.

Identify and compare two management accounting systems and how they are being used to respond to financial problems by organisations.

Further, analyse how in responding to financial problems, management accounting can lead an organisation to sustainable success.

Evaluate how planning tools for accounting respond appropriately to solving problems to lead an organisation such as Easy Seat Ltd. to sustainable success.

LO1

D1: Critically evaluate how management accounting systems and management accounting reporting is integrated within organisational processes.

P2: Explain different methods used for management accounting reporting.

LO3 & 4