MANAGEMENT ACCOUNTING FOR BUSINESS

| December 21, 2015

Knowledge
1. Investigate a range of key management accounting models and concepts.
2. An understanding of specific analytical skills in key areas within management accounting found in the UK and international level.
3. Compare and contrast of the role and scope of management accounting theory.
Skills
4. Analysis the key management accounting concepts and techniques in order to contribute to successful decision making in an organisation.
Learning outcomes:
The assignment covers all module learning outcomes.
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Assignment brief: Answer all three questions
1. Research evidence tends to indicate that Activity based costing (ABC) lacks impact in the UK manufacturing industry. Critically investigate this argument by considering the following areas:
a) Demonstrate and discusses the underlying differences between the ABC and traditional approach?
b) What has been the basis theoretical criticism of ABC?
c) Outline the practical problems that may be encountered in implementing ABC techniques in manufacturing industry and comment on how they may be overcome?
This should be approximately 1,500 words.
Marks 50
2. Strategic management accounting is concerned with providing information that will support the strategic plans and decisions made within a business: you are required to critically review this statement.
In doing so you should consider the following areas of strategic planning:
a) Establishing mission, vision and objectives
b) Undertaking a position analysis such as SWOT
c) Identifying and assessing strategic options
d) Selection of strategic options and formulation of long- and short-term plans
e) Performance review and control
This should be approximately 1,200 words.
Marks 30
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3. Machine Makers Ltd (MM) makes specialist machinery to customers’ specifications. Recently, just as MM completed a particular machine for a customer, it received information that the customer had gone bankrupt with no possibility of any payment to MM being seen as likely. The total contract price was £110,000. The contract specified that payment must be made in stages, as the machine’s manufacture progressed. MM had received £60,000 in progress payments for the machine. It is estimated that the machine could be sold, as it stands, for £80,000.
Another potential customer has been identified for the machine, but this would require alterations to it. Details of the alterations are as follows:
1) Material A. The required quantity is held in inventories. This cost £6,000 when it was bought. It would cost £6,400 to replace it. The material is hazardous and would cost the business £1,000 to scrap it. The business uses it constantly.
2) Material B. By coincidence the appropriate quantity of this material was ordered recently for another contract that was subsequently abandoned because the material was not delivered in time. MM does not normally use this material and its scrap value is £4,000. The original cost price was agreed at £10,000. Though the contract to buy this material is binding, the supplier will accept £8,000 to compensate for the late delivery. The current market buying price is now £7,000.
3) Material C. 20 units of this material will be required. This is in general use in the business. An order for 35 units is shortly to be placed for another job. The price for this material is £130 a unit, but the supplier allows a bulk discount of £10 a unit, for the entire order, for orders of 50 units and above.
4) Labour. 50 hours of labour will be required for the alterations. Labour is a fixed cost to MM, because members of staff are paid in full the normal £12 an hour whether there is work for them to do or not. 20 hours, of the required 50 hours, can be provided by members of staff who currently have no work to do. Only taking staff off other work can provide the remaining 30 hours. This other work is charged out to customers at £30 an hour.
Required:
(a) Define the terms ‘cost’ and ‘relevant costs’ and describe the type of costs that ‘relevant costs’ may include. (6 marks)
(b) Show, with supporting explanations, the minimum price that MM could charge the customer for the altered machine, such that the shareholders would be no worse off as a result. (14 marks)
(Total marks 20)
This should be approximately 300 words.
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Your assignment should aim to provide readers with comprehensive knowledge and critical reviews of these areas covering, for example:
• Knowledge of variety of topic related to management accounting within the concept of decision making by managers.
• Knowledge of compare and contrast of the role and scope of management accounting theory and identifying the costs and benefit that is relevant to a particular decision within the business.
• Your own understandings of, comments on, arguments and contributions to the topic, such as key qualitative characteristics, true and fair view/fair presentation, creative accounting, etc..
• Any other important issues which you think should be addressed
Further details:
This is an individual assignment each question has its own word count this should be adhered to with a tolerance between +10%.
This assignment contributes 100% to the final assessment mark for this module.
Please note that the University policy on cheating collusion and plagiarism will be applied to this piece of work.
The assignment must be handed in both through TURNITIN and at the library by the due date. Your turnitin summary needs to be attached to the copy handed in at the library.
Marking Guide:
Marks will be awarded with respect to the following assessment criteria.
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Undergraduate Assessment Criteria
08/5/5.5
These should be interpreted according to the level at which you are working
Categories
Grade
Relevance
Knowledge
Analysis
Argument and Structure
Critical Evaluation
Presentation
Reference to Literature
Pass
86 – 100%
The work examined is exemplary and provides clear evidence of a complete grasp of the knowledge, understanding and skills appropriate to the Level of the qualification. There is also unequivocal evidence showing that all the learning outcomes and responsibilities appropriate to that Level are fully satisfied. At this level it is expected that the work will be exemplary in all the categories cited above. It will demonstrate a particularly compelling evaluation, originality, and elegance of argument, interpretation or discourse.
76-85%
The work examined is excellent and demonstrates comprehensive knowledge, understanding and skills appropriate to the Level of the qualification. There is also excellent evidence showing that all the learning outcomes and responsibilities appropriate to that level are fully satisfied. At this level it is expected that the work will be excellent in the majority of the categories cited above or by demonstrating particularly compelling evaluation and elegance of argument, interpretation or discourse.
70 – 75%
The work examined is of a high standard and there is evidence of comprehensive knowledge, understanding and skills appropriate to the Level of the qualification. There is clearly articulated evidence demonstrating that all the learning outcomes and responsibilities appropriate to that level are satisfied At this level it is expected that the standard of the work will be high in the majority of the categories cited above or by demonstrating particularly compelling evaluation and elegance of argument, interpretation or discourse.
60 – 69%
Directly relevant to the requirements of the assessment
A substantial knowledge of relevant material, showing a clear grasp of themes, questions and issues therein
Good analysis, clear and orderly, with consistent links from analysis to solutions of problems in a work context.
Generally coherent and logically structured, using an appropriate mode of argument and/or theoretical mode(s)
May contain some distinctive or independent thinking; may begin to formulate an independent position in relation to theory and the application of practice in a work context.
Well written, with standard spelling and grammar, in a readable style with acceptable format
Critical appraisal of up-to-date and/or appropriate literature. Recognition of different perspectives. Very good use of source material. Uses a range of sources
50 – 59%
Some attempt to address the requirements of the assessment: may drift away from this in less focused passages
Adequate knowledge of a fair range of relevant material, with intermittent evidence of an appreciation of its significance
Some analytical treatment, but may be prone to description, or to narrative, which lacks clear analytical purpose, and which does not consistently link analysis to solutions of problems in a work-based context.
Some attempt to construct a coherent argument, but may suffer loss of focus and consistency, with issues at stake stated only vaguely, or theoretical mode(s) couched in simplistic terms
Sound work which expresses a coherent position and evaluates appropriateness of approaches to problem-solving in a work context only in broad terms and in uncritical conformity to one or more standard views of the topic
Competently written, with only minor lapses from standard grammar, with acceptable format
Uses a variety of literature which includes some recent texts and/or appropriate literature, though not necessarily including a substantive amount beyond library texts. Competent use of source material.
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40 – 49%
Some correlation with the requirements of the assessment but there are instances of irrelevance
Basic understanding of the subject but addressing a limited range of material
Largely descriptive or narrative, with little evidence of analysis which links to solutions of problems in a work-based context.
A basic argument is evident, but mainly supported by assertion and there may be a lack of clarity and coherence
Some evidence of a view and a very basic evaluation of the appropriateness of approaches to problem-solving in a work context starting to be formed but mainly derivative.
A simple basic style but with significant deficiencies in expression or format that may pose obstacles for the reader
Some up-to-date and/or appropriate literature used. Goes beyond the material tutor has provided. Limited use of sources to support a point.
Fail
35 – 39%
Relevance to the requirements of the assessment may be very intermittent, and may be reduced to its vaguest and least challenging terms
A limited understanding of a narrow range of material
Heavy dependence on description, and/or on paraphrase, is common, poor evidence of linking analysis to proposed solutions of problems in a work-based context.
Little evidence of coherent argument: lacks development and may be repetitive or thin
Almost wholly derivative: the writer’s contribution rarely goes beyond simplifying paraphrase and does not adequately evaluate the appropriateness of different approaches to solving problems in a work context.
Numerous deficiencies in expression and presentation; the writer may achieve clarity (if at all) only by using a simplistic or repetitious style
Barely adequate use of literature. Over reliance on material provided by the tutor.
The evidence provided shows that the majority of the learning outcomes and responsibilities appropriate to that Level are satisfied – For Compensation consideration.
30 – 34%
The work examined provides insufficient evidence of the knowledge, understanding and skills appropriate to the Level of the qualification. The evidence provided shows that some of the learning outcomes and responsibilities appropriate to that Level are satisfied. The work will be weak in some of the indicators.
15-29%
The work examined is unacceptable and provides little evidence of the knowledge, understanding and skills appropriate to the Level of the qualification. The evidence shows that few of the learning outcomes and responsibilities appropriate to that Level are satisfied. The work will be weak in several of the indicators.
0-14%
The work examined is unacceptable and provides almost no evidence of the knowledge, understanding and skills appropriate to the Level of the qualification. The evidence fails to show that any of the learning outcomes and responsibilities appropriate to that Level are satisfied. The work will be weak in the majority or all of the indicators.

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