Managerial Accounting Examples

Managerial accounting can take different forms, depending on organizational

need. Some of the primary examples of managerial accounting include:

 Product costing and valuation. Product costing refers to the calculation

of the total cost of producing a good or service. Managerial accountants
calculate overhead expenses and other variables to determine the true cost
of a product or service, which can provide direction for companies looking
to sell or divest.
 Cash flow analysis. Managerial accountants may also be tasked with
determining the cash impact of various business decisions. This involves
assessment of the cash inflow and cash outflow related to a particular
decision, such as purchasing a piece of equipment.
 Break-even analysis. This entails calculating the break-even point for a
product or service (the point at which total cost and total revenue are
equal). This type of analysis is particularly beneficial when businesses
introduce new products or services and can be useful for setting price
points on new items.
 Constraint analysis. Managerial accountants may also perform constraint
analysis. This entails evaluating hurdles or bottlenecks within sales or
production processes; calculating their impact on revenue, profit and cash
flow; and seeking ways to make the process more efficient.