Explore absorption and marginal costing techniques for decision making.

Unit 13 Cost and management Accounting - Pearson BTEC International Level 3 Extended Diploma in Business

Assignment - Cost and Management Accounting techniques used in business

Learning aim A: Explore absorption and marginal costing techniques for decision making.

Learning aim B: Carry out standard costing and variance analysis statements.

Learning aim C: Explore budgets for financial planning and control.

Learning aim D: Undertake investment appraisal of long-term capital investment.

Scenario:

You have recently been appointed as a trainee in the Finance and Accounting department of a company. As a part of your internship, your team head has asked you to prepare reports to show your understanding and application of cost and management accounting techniques. He has given you tasks related to costing methods and management accounting decisions used widely in business organisations.

You must prepare the required reports and case studies given and submit the report to your Team head as a part of your internship so that the company offers you a full time job in this department.

Task 1.

You must write a report explaining the difference between cost and management accounting. Categorize and explain the different types of cost. Explain the costing methods like absorption costing and marginal costing used by business in different decision-making situations like the ones provided below by calculating accurately the absorption and marginal cost statements. Further, assess appropriateness of these methods used for decision making in the given situations.