FINANCIAL ANALYSIS

Dolphinholme Holdings Plc



Dolphinholme Holdings Plc

Introduction

The practical role of managerial accounting is to increase knowledge within an organization and therefore reduce the risk associated with making decisions. The information produced for managers is used to make decisions regarding the planning and controlling of operations. A decision is concerned with the selection of an action often out of a number of alternatives. In order to choose the right one, decision-makers need some guidance, which is partially provided by information gathered by management accounting. Tools such as activity-based costing/management, budgeting, cost volume profit analysis etc. used by the management accountants are consequently considered as a helpful support. This paper focuses on describing the roles played by the management accountants in various areas in the organisation for decision making.It plays a vital role in activities such as planning, directing and motivating and controlling. The main role of management accountant has always been to improve their organisation's performance by providing relevant information for decision making.

When it comes to the change of management accounting or management accountant, several researchers and scholars have stated the similar view that people cannot describe the management accountants as 'the bean counter', 'the scorekeeper' or 'the corporate cop' in the contemporary age, their new role are performed as 'a strategic planner' and 'a business partner' within the organization. (Kaplan, Pp.400, 1984). This essay is aiming to find out how 'the bean counter', 'the scorekeeper' and 'the corporate cop' become to the internal consultant, the strategic planner as a business partner. It is widely appreciated that the business environment has greatly changed in the recent years. Thus that the traditional management accounting is not suitable for the contemporary business, a new management accounting system was generated. Following that there are many new management accounting techniques are required, it directly change the task of management accountants. Finally all these process have caused the change of the role of the management accountant.

Task I.

Part A.

The graph, calculations and the table results are shown in the spreadsheet. Review the Excel sheet for the data and tables.

Part B. Explanation

First of all need to calculate the regression coefficient 'b' using the formula y= bx+a. This has been calculated using the October cost and sales revenue. Once the variable cost coefficient is calculated we can use this 'b coefficient' to find out the values of the other months regression. The sales figures, fixed and variable costs are inserted in the table as shown in the excel spreadsheet. The graph is plotted of the linear regression equation using the scatter diagram and the original values. The coefficient of the regression 'b' calculated to be 0.02916433.

The importance of linear regression can be analysed by this table. Regression consists of a group of random variables that is predicted to be Y .This tries to find the mathematical relationship between the random variables and Y. This relation is specifically in the form of a straight line that best approximates the data points ...