0518_68_DS – Management Accounting
UK College of Business and Computing
Marking Scheme
| Unit Name | MANAGEMENT ACCOUNTING (RQF) |
| Unit Level | 4 |
| Unit Code | H/508/0489 |
| Module Leader | Khalid Karim |
| ASSESSMENT CRITERIA | LEARNING OUTCOME | ASSIGNMENT QUESTION | |
| Task 1
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| P1 | LO1 | Explanation of management accounting and the essential requirements of management accounting system which entails:
I. Distinguishing Management Accounting from Financial Accounting.
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This must start as a report format. You are to respond as an Apprentice or Trainee Management accountant. Provide an explanation or the rationale for having a management accounting system. A good definition of management accounting would cover the essential functions of management accounting. Then, distinguish management accounting from financial accounting by stating major differences and similarities between management accounting and financial accounting |
| II. The importance of management accounting information as a decision-making tool for department managers.
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Provide a definition of information as being processed data and link this to management accounting informational as being management accounting data processed for decision making. Explain management accounting tools and provide examples. Benefits of management accounting tools in the review of product performance; make or buy decision; contract costing; pricing decisions should be discussed | ||
| III. Cost accounting systems (actual, normal and standard costing)
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Provide definitions and examples of Actual, Normal, Standard costing | ||
| IV. Inventory management systems
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Provide an explanation of Inventory management systems LIFO; FIFO & AVCO | ||
| V. Job costing systems. | Provide an explanation of Job costing systems such as Batch Costing; Contract costing; Process Costing; and Service costing | ||
| P2 | LO1 | Presenting financial information.
I. Different types of managerial accounting reports II. Why it is important for the information to be presented in manner that must be understandable. |
A learner is expected to;
路 Provide an explanation of managerial accounting reports different types of managerial accounting reports. Examples such as Scheduled report; Exception report; Demand report etc. 路 Explain why it is important for information presented to management to be in a format that can easily understood |
| M1 | LO1 | To achieve M1 | You will need to build on P1 & P2 to evaluate the benefits of management accounting systems and their application within the context of Tech (UK) Limited. For example-
路 Highlight the benefits a company like Tech (UK) will enjoy by using different management accounting systems that s/he has mentioned in P1.
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| D1 | LO1 | To achieve D1. | You will need to develop M1 to include critically evaluation of how management accounting systems and management accounting reporting is integrated within organisational processes :
路 Emphasise more on critical review on聽HOW,聽management accounting systems and management accounting reporting is integrated within the system. 路 Learners should find points in favour and against the integration itself. |
| Task 2 | |||
| P3 | LO2 | You are required to prepare income statements for the month of September (based on the example given in the assignment brief) using;
I. absorption costing and II. marginal costing methods |
Learners are expected to;
路 This is a pure mathematical problem. However, not necessarily all the learners should have the same answer, but the process and steps of the calculation should be assessed to get a pass. 路 You will need to show calculation of profits using Absorption costing method 路 You will need to show calculation of profits using Marginal costing method |
| M2 | LO2 | To achieve M2 | In addition to calculation of profits using both methods in P3 you will need to accurately reconcile the profits for both methods to produce appropriate financial reporting document.
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| D2 | LO2 | To achieve D2 you will need to accurate apply and interpret the data for the business activities. | To achieve D2 you will need to accurate apply and interpret the data for the business activities. |
| Task 3 | |||
| P4 | LO3 | In your report you should cover;
a) Different kinds of budgets and their advantages and disadvantages b) The budget preparation process including determination of pricing and different costing systems that can be used. c) The importance of budget as a tool for planning and control purposes. |
Learners are expected to;
路 Learners should provide different types of budgeting systems such as; roll over budget, static budget, cash flow budget etc. The advantages and disadvantages of each types of budget need to be added. 路 Process of budgeting needs to be added. A list of processes will be better but not essential. 路 Learners should explain pricing strategies based on MA not marketing pricing strategies.
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| M3 | LO3 | To achieve M3 | You will need to analyse the use of the different planning tools and their application for preparing and forecasting budgets.
Example of planning tools can include PEST, SWOT, Balance scorecard, Porter鈥檚 five forces analysis to financial position of Tech Ltd.
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| D3 | LO3 | To achieve D3 | You will need to evaluate how planning tools for accounting respond appropriately to solving financial problems to lead to sustainable success.;
路 Evaluate planning tools that has mentioned in M3 and highlight聽HOW聽these will solve financial problems. |
| Task 4 | |||
| P5 | LO4
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Referring to Tech鈥檚 current financial situation, explain ways by which the Balanced Scorecard approach suggested by the auditors can be used to respond its financial problem and compare this approach to another management accounting approach used in another organisation of your choice. You must provide relevant financial information about the other organisation you have selected for comparison. | A learner is expected to;
路 Learners should provide thorough analysis of Balance Score Card which will lead to identifying and responding to the financial problems. Learners should link the answer with Tech (UK). 路 Suggestions around financial perspective such as use of ratios to analyse financial performance will be a strong answer. 路 Learners should be able to write how this BSC can be used to improve the financial governance and development strategies. Learners should have a clear idea about BSC so that they can relate it to the financial governance for the company. 路 Utilising input from all the four perspectives giving examples will be a good answer. |
| M4 | LO4
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To achieve M4 | You will need to analyse how, in responding to financial problems, management accounting can lead organisations to sustainable success.
路 Analyse the link between solving financial problems through management accounting for sustainable success.
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| D3 | LO4 | To achieve D3 | You will need to evaluate how planning tools for accounting respond appropriately to solving financial problems to lead to sustainable success.
路 Evaluate the usage of planning tools for organisational success. |
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