Management Accounting - Total Quality Management Essay

Management Accounting - Total Quality Management - Essay ExampleAs the managerial accounting is a phase of accounting that is concerned with the nurture provided to managers, the planning and controlling operations exit be effective. The information will be regarding the feedbacks of operations, activities and finances of the company. These activities require efficient monitoring. The provision of good information for the implementation of managerial accounting will result in coming out of finished products in time. The non value added activities ar also taken into account to provide the required information. The further information provided by the company is regarding organizational charts, performance reports, cross check art cycle, planning methods, control cycle, processing and engineering, earthy materials, segments, setup , staff. These ar provided by taking into consideration the put time and innate quality management. ( plane section of Defence, 2007) 11.1 Breakeven Ch art In preparing a chart the breakeven point for the activities company that creates profit is important. This involves the determined cost and variable costs. These values for the product cetnrex are as follows.It was estimated that the variable cost per unit is 10 GBP. The fixed cost is estimated at 25,000GBP. The variable cost of 10,000 units as mentioned will be 10x10,000 = 1,00,000GBP. The following interpret shows reduce of units in X axis and cost in thousands of pounds on Y - axis. The fixed cost is shown as 25,000 GBP. 2The taxation line is plotted after plotting the breakeven chart. The gross revenue price is multiplied by tot up of units and this amount is considered as output. The sales price for the product of Derailler gears is given as 14 GBP, the natural revenue can be calculated as 14x10,000= 140000. The total revenue line and variable cost lines are in different colors. The point where the two lines will intersect denotes the breakeven point. The breakeven p oint indicated in the following graph is 1, 25,000 GBP. The profit will be 1, 40,000-1, 25,000 = 15,000GBP on the Centrex product. 32.2 Breakeven Level of Output The fixed costs of the products are estimated at 25,000 GBP. The variable costs will not be more than 1,00,000 GBP. This plugs the maximum costs at 1,25,000 GBP. As the company has planned to sell the units at 14 GBP per unit, the minimum revenues accrued due to the sales will be 1,40,000 GBP and this ensures a minimum profit of 15,000 GBP. This means that the marketing and sales targets reach the breakeven when the total sales revenue is 1,40,000 GBP. The wasted revenue accrued after that point will be the extra profit and the 15,000 GBP mentioned above can be considered as the minimum profit by selling the 10,000 units of Centrex. The total portion encompassed by the graph is divided into two portions. The top potion denotes the profit and the lower represents the probability of loss. though the probability of loss is mo re in this venture, the possibility of gaining can be termed as more as the analysis is breakeven as fixed and variable costs prevail over the aspects considered in the analysis and the agent is explained in the next subsection (2.3)2.3 Percentage Margin Safety The outcome obtained by subtracting the breakeven sales from the forecasted sales is termed as percentage margin safety. It can also calculated by dividing the operating income by moolah sales. As we considered the breakeven