Management Accounting Paper

Management Accounting paper, questions to answer - first question in Section A and any 3 questions out of 4 from section B (4 questions total). 

Get Help With a similar task to - Management Accounting Paper

Login to view and/or buy answers.. or post an answer
Additional Instructions:

Section A Question 1 Green Health Ltd in a producer of high precision operating theatre. Considering the niche market and complexity of the manufacturing process, the production requires highly specialised labour. Following research on the manufacturing time, the company has realised that there is a learning curve effect on the labour hours needed to produce each unit. The directors have, therefore, to factor that learning curve effect during the planning phase by reflecting it in future forecast times and costs. The table below reflects the manufacturing times for one particular instrument, the BScanner. Cumulative production (Units) Cumulative time (Hours) Average time per unit (Hours) 1 400 400.0 2 720 360.0 4 1,296 324.0 8 2332 291.6 The labour time analyses have shown that the learning curve follows the general form: Y = aXb Where: Y = average labour hours per unit X = cumulative number of units a = labour hours required for the production of the first unit b = the learning index given by Log(r)/Log(2) Green Health Ltd has redesigned the BScanner, named BScanner 2.0, and would like to start production as soon as possible knowing that the same learning effect will apply to the production of the Bscanner 2.0. The directors would like to have a forecast of the cost per unit of BScanner 2.0 in a future period. The data related to the production of the BScanner 2.0 are as follows: Estimated cumulative production at start of period 528 units Estimated production in period 86 units Estimated overheads £150,903 Estimated labour cost £15 per hour Estimated material cost per unit £250 Required: (a) Calculate an estimated cost for the BScanner 2.0. (8 marks) (b) In a detailed report to the Director, discuss the importance of the learning effect and its why it is important to make an allowance for it when forecasting future labour costs and times. (15 marks) (c) Discuss the limitations of the learning effect. (7 marks) (d) What pricing strategy would you recommend the company to employ? Discuss in detail with examples the reasons for your suggestion while providing a review of different pricing options. (10 marks) (Total 40 marks) Section B Question 2 The management of Genesis Mining plc is considering four different projects all of which require investment if they are to proceed. Information on the proposed mines is given below: Investment Project Number 1 2 3 4 Investment required (£540,000) (£900,000) (£800,000) (£960,000) PV Cashflow with a 10% discounting factor £672,280 £1,045,940 £759,520 £1,135,540 NPV 132,280 145,940 (40,480) 174,540 Project duration 6 years 3 years 5 years 6 years IRR % 18% 19% 8% 16% The rate of return required by the company is 10%; therefore, the cash inflow has been discounted as 10%. Funds in the company are limited making it impossible for the company to invest in all four of the mining projects. Required: (a) Calculate the profitability index for each project. State your answer to the three decimal places. (3 marks) (b) Provide a ranking of the projects in accordance with your preference based on a. Net present value b. Profitability index c. Internal rate of return (3 marks) (c) Provide an objective and detailed discussion of the above three methods and in your concluding remark indicate which one would be the preferred method? (14 marks) (Total 20 marks) Question 3 Oumalker manufactures two products from the same resources. Product revenue and cost details are as follows: Product M N £/unit £/unit Selling price 95 80 Direct Material type 1 (£5 per kg) 25 20 Direct Material type 2 (£4 per kg) 16 12 Skilled Labour (£6 per hour) 18 24 Variable overhead (£3 per machine hour) 9 6 Contribution 27 18 The maximum weekly demand for products M and N is 325 and 375 units respectively, however for the next 6 weeks this level will not be reached due to a lack of suitable resources. Specifically, the resources that will be available per week are scheduled below: Direct Material type1 2000 kg Direct Material type 2 2400 kg Skilled Labour 2500 hours Machine time 1200 machine hours Required: (a) Assuming that Oumalker wishes to maximise contribution during the next 6 weeks, formulate the constraints that they face each week and identify the weekly production schedule that will maximise the contribution using the simultaneous equation technique of linear programming (8 Marks) (b) In a succinct report to the manager, discuss the importance as well as the advantages and disadvantages of the limiting factor analysis in the context of Strategic Management Accounting (12 marks) (Total 20 marks) Question 4 Strategic management accounting emphasises on the importance of performance measurement. It is crucial for managers to monitor financial and non-financial performance indicators. Required: (c) Explain in detail how Balance Scorecards, the Performance Pyramid, and the Building blocks model combine both financial and non-financial indicators to assess a firm’s performance. (12 marks) (d) You are required to discuss in detail the limitations and merits of those three performance measurement tools. (8 marks) (Total 20 marks) Question 5 As a consultant for a start-up company, you have been hired to support the management of a company derive competitive advantage and enhance their long-term profit. The management of the company has identified cost management as a key driver for this. As the managers of the company are predominantly from an IT background, you are requested to write a report comparing and contrasting Lifecycle costing and functional analysis. In your report you will explain how each of these techniques could help a company gain a competitive advantage. (Total 20 marks) Task Learning Outcome assessed 1 2, 3, 5 & 7 2 3, 5 & 7 3 4, 5 & 7 4 1, 2, & 7 5 1, 4 & 7

Related Questions

Similar orders to Management Accounting Paper
15
Views
0
Answers
Management Accounting online exam
I need someone to do my management accounting online exam...
14
Views
0
Answers
Managerial Accounting exam
Hey there! I am a college student looking to gain a degree in business administration. Part of that degree requires that I pass two classes focusing on the basics of accounting, as well as managerial accounting. I have hired tutors, spent countless hours...
19
Views
0
Answers
Intro to Accounting 1
An online exam with 60 min to complete...
28
Views
0
Answers
accounting
Need someone to do my accounting for a low rate...