Managerial Accounting Research Essay

Managerial Accounting Research Essay

Introduction

Accounting is a critical part of running a business. Since there are various forms of accounting that can be used, it is important to know which technique is best to use for what companies since they are unique. Once a particular technique is established, it is also important to keep an open mind if there are changes that need to take place in the organization. Keeping an open mind helps the company adjust and move forward in a timely fashion.

Most businesses exist to make a profit. Accounting is an important part in helping understand how the profits and expense amounts are derived. Accounting can broken up into many areas which are all slightly different in nature depending on the process and objectives. Many of the formulas, statements and mechanisms are used and the fundamentals of them are still the same (Scholasticus, 2011).

Cost accounting systems record manufacturing activities for inventory systems that update records for cost of materials, goods in process and finished product.  It must be timely information about inventory and manufacturing costs in order for management to control costs and set selling prices (Wild & Shaw, 2012).  A cost accounting system requires five parts that include an input measuring basis, an inventory valuation method, a cost accumulation and flow assumption and a way to record inventory cost flow in intervals (Martin, n.d).  Many possible cost systems can be designed to fit a company's specifications. 

Managerial Accounting helps establish goals for the company and cost accounting is concerned with a company's cost production.

Managerial accounting is the recording, planning and analysis of income and expenses (Scholasticus, 2011). Management accounting involves interpreting accounting information for management's use. This interpreted information is reported either daily, weekly, or monthly. The information generated helps managers make decisions regarding about operations and strategy. Managerial accounting takes the information derived from financial and costing methods to make observations and decisions that will internally direct the company.

Discussion

The research areas and research findings in managerial accounting are

Product costing for decision making

Dileep G. Dhavale in his article has discussed the key concept and role of the product costing in decision making. According to Dileep there are times when a business activity needs changes while it is still ongoing to enable the company to still hit its goals. Dileep considers theses changes particularly important in certain variable proportion technologies. According to dileep sometimes, these changes are still being proposed and ideas are still being brainstormed in meetings. These changes are important because things may not go well in a business venture. In the course of activity of any given business, the expenses that are based upon how the business is going are called variable costs. When the ideas and other proposed alternatives in a necessary decision is being collected and presented, this process is called full cost accounting (Dileep, 2007).

Furthermore, dileep considers that Understanding how variable costs work can help you in handling your business properly. This is why knowing the deeper definition of variable costs ...