Essays on Management Accounting, Breakeven Analysis Assignment

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The paper "Management Accounting, Breakeven Analysis " is a great example of a business assignment. Managerial accounting can present a detailed plan for the future regarding cost, expenses, budgets and profits. It takes into account the constraints, controls and the process of the controls in planning the accounting and budgeting. The decentralization of the processes and decision-making will make this effective. The directions and motivations are part of the managerial accounting. The financial and operational feedbacks are necessary and should be continuously monitored. This ensures the finished products come out in time.

This can be termed as the phase of accounting concerned with providing information to managers to use in planning and controlling the processes and operations. This will take into account the non-value-added activities, organizational charts, performance reports, plan do check act cycle, planning, control cycle, process and reengineering, raw materials, segments, setup, staff, throughput time and TQM are taken into consideration. (Mc Graw Hill Companies, 2007) Task 1 Breakeven Analysis Breakeven Chart: The breakeven point is important for preparing the chart. The fixed costs and variable costs for the centrex product are as follows: The variable cost per unit is 10 GBP.

The fixed cost is 25,000GBP. The variable cost of 10,000 units as mentioned will be 10x10,000 = 1,00,000GBP. The following graph shows the number of units on the X-axis and costs in the lacs of pounds on the Y-axis. The fixed cost is shown as 25,000 GBP. (Mc Graw Hill, 2007) After this, the total revenue line has to be plotted. This requires the multiplication of sales price by the number of units and termed as output. As the sales price is 14 GBP the total revenue can be calculated as 14x10,000= 140000.

The4 total revenue line is in orange colour and the variable cost line is in green color. The intersection of them will give the break-even point as 1,25,000 GBP. The profit will be 1,40,000-1,25,000 = 15,000GBP on the centrex product. (bbc. co. uk, 2007)

References

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1. Mc Graw Hill Companies, 2007, Managerial accounting and business environment, Mc Graw Hill, ,electronic, 7—07-07, http://www.mhhe.com/business/accounting/garrison/Student/olc/garrison9emgracct_s/ch01s_kt.html#Managerial Accounting

2.Mc Graw Hill, 2007, Managerial accounting and business environment, Mc Graw Hill, ,electronic, 8-7-07, http://www.mhhe.com/business/accounting/garrison/Student/olc/garrison9emgracct_s/ch01s_cs.html

3. bbc.co.uk, 2007, breakeven analysis, bbc.co.uk, Business studies production, ,electronic, 8-7-07, http://www.bbc.co.uk/schools/gcsebitesize/business/production/breakevenanalysisrev3.shtml

4. cliffsnotes.com, 2007, Margin of safety, Cliffsnotes.com ,electronic, 8-7-07, http://www.cliffsnotes.com/WileyCDA/CliffsReviewTopic/Margin-of-Safety.topicArticleId-21248,articleId-21230.html

5. D.J.Power, 2000, supporting business decision making, Dss resources, ,electronic, 8-7-07, http://dssresources.com/dssbook/ch1sbdm.pdf

6. Michael Bremer , 2004, Overhead allocation - does it make sense? , imakenuews.com, ,electronic, 8-7-07, http://www.imakenews.com/rainmakers/e_article000057368.cfm?x=b11,0,w

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