LEARNING OUTCOMES
The primary objectives of the assignment are to examine your ability to:
(a) analyse and provide recommendations to improve the operations of organisations through the application of management accounting techniques,
(b) apply techniques associated with costing systems, cost management systems, budgeting systems and performance measurement systems,
(c) appreciate the need for a balance between financial and non-financial information in decision making, control and performance evaluation applications of management accounting,
(d) learn within teams - to cooperate with team members, to assume leadership and to manage differences and conflicts, and
(e) tolerate ambiguity in managerial and organisational problem-solving
Consequently, you should be able to analyse complex issues, to formulate well-reasoned and coherent arguments and to reach well-considered conclusions. Also, you should be able to present these conclusions via a written format appropriate for the real-life business environment, and be able to perform the necessary processes to prepare internal reports for decision-making purposes.
POLICY ON EXTENSIONS
All requests for assignment extensions must be made in advance of the due date to the course coordinator. Significant reasons must exist for an extension and supporting medical evidence may need to be provided.
GENERALINSTRUCTIONS
- This assignment can be completed in teams of either 3 or 4 students. It is expected that each team will manage the tasks required for the assignment in a way that ensures all members contribute fully and effectively to the completion of the assignment. All members of the teamwill receive the same score.
- Please remember to retain the original computer file (including the completed cover page) for your own reference and as insurance in the event that a copy of your assignment is requested.
FORMAT AND PRESENTATION
You should ensure that your assignment is well-presented and is as clear and concise as possible. Presentation includes formatting and layout considerations to suit a professional business report, which assist in conveying information to the reader in a manner that is easy to follow. Ensure that you appropriately cross-reference your work. Also, if you draw on information from other sources, ensure that you apply an appropriate referencing style consistently.
Your assignment must be word-processed, using the Times New Roman font size 12 (or equivalent). The line spacing must be at least a line and a half and there must be a minimum page margin 2.5 cm on all sides. Round figures to 2 decimal points where necessary. Please also include the BUSN7031 Team Assignment Cover Sheet (available from Wattle) as part of your assignment submission.
INTRODUCTION
You are part of a team of consultants employed by Renegade Consultants. The principal, William Renegade, calls a meeting with your team to brief you on a new client, Mystique.
REQUIREMENTS
Your team is required to write a businessreport to the management, responding to Mystique's requirements and other issues listed below. Ensure that you follow the format and presentation guidelines outlined on page 3. The report is to include an executive summary and to be no more than 2,500 words (excluding the executive summary).
1. Provide the following calculations in suitable report format (Use schedules to show your calculations):
a. Total manufacturing cost per box for each product using planned production as the allocation base;
b. Total manufacturing cost per box for each product using the total of direct material and direct labour costs as the allocation base;
c. Total manufacturing cost per box for each product using William's suggestion of Activity-Based Costing. As part of this calculation, you will need to ascertain the most appropriate base to allocate factory administration cost, using simple regression. You may use Excel or a statistical software package. As part of your deliberations, you must evaluate the suitability of each base using the following criteria to evaluate the regressions:
- economic plausibility
- goodness of fit
- significance of independent variable (use a t-critical value of 2.228) - specification analysis: linearity and independence of the residuals.
In your report, discuss the evaluations for each of the five possible allocation bases suggested by Charlie and, based on your discussion, indicate the allocation base that you think is most appropriate of the five options.
2. Comparing your calculations using (i) planned production volume, (ii) the total of direct material and direct labour costs, and (iii) activity-based costing, what comments can you make about total manufacturing costs and the profitability of the three products?
3. Should Mystique adopt an activity-based costing system for its products? As part of your discussion, you should explain the processes involved in implementing activity-based costing and consider the advantages, disadvantages and implications of activity-based costing and activity-based management.
4. Provide a discussion of the suitability of EIS given Mystique's circumstances. As part of your discussion, you should explain the financial and non-financial benefits of EIS, how management accounting information/systems/processes affect or are affected, ways to evaluate the success of EIS implementation, potential barriers to implementation and corrective mechanisms that can mitigate those barriers and finally, recommendation whether Mystique adopts an EIS or not.
While some discussion may be general in nature, ensure that your report makes specific reference to Mystique's circumstances where applicable.
Attachment:- Team Assignment.rar