Control Systems

Question 1

Control doesnot always result in good results

When can control be utilised

Answer 1

3 thing
Able to set objective ( Target)
measure output (Control)
Take correction actions (Actions )

Question 2

Management Accounting costing system
Set the target
Measure performance
Compare Target to Performance
Anaysis varience

Answer 2

Responsibilities accounting
1 Cost centre , Revenue center , profit center and investment centre ( cost, revenue and profits)
2.How - identify controlability vs uncontrollably
3.Determine how challengig targets should be
4 How much influence manager shoulf have in target setting

Question 3

Controlability principle

Answer 3

Objective is to only charge based on areas of responsibility
Consider -

economic factors,competition,acts of nature , and independence ( where other costs involved)

before and after measurements period -

Setting performance
- how demanding should target be to motivate best level performance
=How much participation should manager have in setting own targets
top down approach
bottom up approach - create a sense of fulfillment , motivation,goal congruence.,