Management Accounting

Executive Summary

First and foremost I would like to thank to our lecture for helping me regarding some problem that I had faced in this assignment. This assignment is about a Japanese owned company in Malaysia. In Part A we should define the responsibility accounting and comment on the application of responsibility accounting in the context of the situation. Secondly, in Part B we are asked to explain hoe responsibility may be shared in respect of the cost of the maintenance department and suggest ways in which the management accounting system may assist in recognizing such shared responsibility. Finally, in Part c, we should explain ways in which the provision of more information need not lead to more effective management of a cost center.

Table Of content

Part | Content | Page No |

(a) | Define responsibility accounting and comment on the application of responsibility accounting in the context of the situation * Definition of responsibility accounting * Types of responsibility accounting | 3 -7 |

(b) | Explain how responsibility may be shared in respect of the cost of the maintenance department and suggest ways in which the management accounting system may assist in recognizing such shared responsibility * Definition of the maintenance expenses | 8 |

(c) | Explain ways in which the provision of more information need lead to more effective management of a cost center * Cost management | 9 - 11 |

(d) | References | 12 |

Define responsibility accounting and comment on the application of responsibility accounting in the context of the situation

Definition of Responsibility Accounting

Responsibility accounting is a collection, conclusions, and reporting financial information about the decision centers (responsibility centers) throughout an organization. It also called activity accounting or profitability accounting. It traces costs, revenues, or profits to the individual managers who are responsible for making decisions about the...