Question

what industry currently needs management accountants the most and why? Compare and contrast fixed cost variances and variable cost variances commenting on how to interpret each if Favorable?

Answer 1

what industry currently needs management accountants the most and why?

Management accountants offen confused with financial accountants they provide valuable services to the organisation

Management accountants do the reporting tasks and helps in decision making in the management and financial decisions too.

Management accountant perform their task in public, private, non-profit and governmental companies

Management accountants provide services by way of

1. Budget analyst
2. Financial analyst
3. Accounting manager
4. Finance controller
5. CEO OR CFO

Compare and contrast fixed cost variances and variable cost variances commenting on how to interpret each if Favourable?

Fixed cost variance = budgeted fixed cost – actual fixed cost

When fixed cost variance is favourable it means company is managed to reduce fixed cost compared to budgeted fixed cost by way best cost reduction techniques

Variable cost variance = budget variable cost – actual variable cost

When variable cost variance is favourable it means company managed to reduce the variable cost then the budgeted variable cost. By way of effective management techiest by way of reduction of wastages etc

Controlling of variable cost is important for the company for making better products and services to the customer at low cost