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AYB225 Management Accounting

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Question:

You have gained a position as vacation student at the accounting firm T&K Solutions. In your capacity of vacation student you have been asked by the two partners of T&K Solutions to assist them with two operational issues they are debating by providing input and analysis. Specifically;
 
A. The partners are undecided on whether to keep or drop their bookkeeping service. To facilitate their decision-making they have requested you recalculate last year’s profit and loss statement without the bookkeeping service. The partners have asked that you then send them an email clearly stating whether you think they should keep or drop the  service. Draw from your calculations as well as non-financial factors to justify your decision.
B. The partners are in disagreement about the value of budgeting for their firm. While Terry has never spent much time on budgeting, Kerry believes that by introducing a flexible budgeting process they will gain a greater level of control over their firm’s revenue and expenditure. They have asked you to prepare a flexible budget for each service unit, calculate variances to actual, and present the results using the graph function in Excel.
C. The partners have also asked you to write a report to help them resolve their divided opinions with regard to budgeting. They require you to draw on your own knowledge.
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