Management Accounting Strategy Study Resource for CIMA Students: CIMA Study Resources

By Commerce Central

This resource will help professional accounting students consider the relationship between theories and techniques learned and how a combination of these theories is appropriate to reach even the most fundamental business outcomes related to planning and decision-making.

 

Unlock the strategic prowess within your accounting studies with this comprehensive resource, meticulously crafted to elevate your decision-making skills to new heights. 

 

Tailored for ambitious CIMA students, this guide illuminates the intricate dance between theory and application, empowering you to deftly navigate the complexities of business objectives and profitability.

 

From foundational principles to advanced techniques, embark on a journey that seamlessly integrates theoretical knowledge with practical wisdom. Explore the symbiotic relationship between concepts such as break-even analysis, activity-based costing, and costing systems design, gaining invaluable insights into their strategic implications.

 

Delve into the strategic significance of cost structures and unravel the symbiosis between costs and demand analysis, equipping yourself with the acumen to drive informed decisions that propel businesses forward. Step into the realm of planning and decision-making with confidence, armed with a robust toolbox of competitive advantage.

 

Start developing your toolbox of competitive advantage today.

 

• Language: English
• Publisher: Commerce Central
• Release date: Apr 23, 2024
• ISBN: 9798224894499

Book preview

The Purpose of Management Accounting: Decision-Making

Management accountants and accounting students benefit from analysing activities in terms of what decisions need to be made and then considering which of the management accounting theories should be applied to reach the best possible conclusion.

Managers at different organisational levels make different types of decisions: operational, tactical, and strategic.

Decision-making involves the evaluation of different courses of action using a decision-making framework based on predetermined objectives and measurement criteria. I.e. choosing courses of action that satisfy objectives most effectively.

Next, we will consider some specific examples of decisions and introduce the example company we will use throughout the rest of the chapters. But before looking at an illustration, we need to define some terms and explain concepts used in the upcoming example.

Classification of Costs

There are two main cost classifications, element, and behaviour. An example of element classification is ‘Rent expense’ or ‘Insurance expense’. An example of behaviour classification is variable or semi-variable costs.

Classification of Costs According to Element

Classifying costs according to their element involves grouping costs based on the elements of production, e.g. materials, labour, and overheads.