MANAGEMENT ACCOUNTING PRACTICES AND THE

PERFORMANCE OF FAST-FOOD CHAINS IN

DIGOS CITY DAVAO DEL SUR.

AILYN CRISTY M. DRILON

A THESIS OUTLINE SUBMITTED TO THE FACULTY OF INSTITUTE

OF BUSINESS EDUCATION AND GOVERNANCE (IBEG)
OF DAVAO DEL SUR STATE COLLEGE, MATTI,
DIGOS CITY, DAVAO DEL SUR

BACHELOR OF SCIENCE IN ACCOUNTING INFORMATION SYSTEM

November 2021
 CHAPTER I

THE BACKGROUND AND ITS PROBLEM

Introduction

Notwithstanding the significance and advantages, the degree of

reception and execution of practice is still powerless in firms in numerous

nations, particularly in non-industrial nations, similar to Malaysia. Most

chiefs don't understand the advantages of working on management

accounting (Gunarathneb & Alahakoon, 2016).

Consequently, numerous potential chances to lessen expenses are

lost according to Jamil, et. all (2015). This is because of low mindfulness,

need of compelling job of expert bodies, absence of partners' tension, as

well as feeble natural regulation and troubles looked by firms

(Gunarathneb & Alahakoon, 2016).

Writing demonstrates that conventional administration bookkeeping

frameworks and endeavors regularly miss the mark in giving satisfactory

or fitting information to be utilized in the organization of climate,

additionally for the board of costs connected with the administration of

that climate (Vasile and Man, 2012). Organizations extensively

misconstrue both the expenses and advantages of exhaustive natural

administration (Christ and Burrit, 2013). Heong, et. al (2013) examined

how much CMAPs and SMAPs were being embraced in Malaysia,

Singapore, China and India.S They found that not only was the usage of

key organization accounting deals with feeble in all of the four countries

yet also that audit respondents saw that the benefits that form from using

customary MAPs were "especially high".

If the shortcoming of associations in normally fragile endeavors

concerning their business environmental impacts, "it is reasonable to

acknowledge a firm inside the retail business will have different natural

organization frameworks and approaches than a near assessed firm in the

extractive or compound industry as cited by Sulaiman and Mokhtar

(2012).

It has also been fought that associations in biologically tricky

endeavors will undoubtedly encourage internal regular organization

practices to "educate and enlighten" their accomplices about the

association's environmental execution (Ribeiro & Aibar‐Guzman, 2010).

Essentially, Ferreira et al. (2010) fight that the EMA execution of

associations in normally mindfulness adventures is past basic turn of

events.
 As firms progress in their execution of lean collecting, many are

seeing the requirement for a consistent organization accounting and

control structure Rogošić, and Ramljak (2012). Nonetheless, accounting

assessment (and preparing) has been delayed to see the meaning of

changing management accounting and control practices to a lean

gathering technique (Castellano & Burrows, 2011; Haskin, 2010). This

study watches out for this cutoff by investigating whether and how the

chiefs accounting practices and controls are used in favor of lean

gathering.

As of now, the use of standard organization accounting strategies,

for instance, customary thing costing isn't tending to client needs for a

collection of reasons. It has been stated that standard organization

accounting techniques can't satisfy the clients of such strategies to the

extent that outfitting them with ideal and point by point information. As

shown by the chiefs accounting talk, when affiliations circumspectly

embrace appropriate key organization accounting practices, they would

ensure productive managerial decisions that would finally incite smoothing

out legitimate execution. Thusly, the level of additional created execution

that an affiliation would achieve would depend upon its careful utilization

of fitting key organization systems.

 The impact of the executives bookkeeping rehearses and their

effect on the exhibition of inexpensive food chains in the global extension

has proactively been directed however is yet to be examined inside the

region of Digos City. With these contemplations and the way that there

has been a shortage of writing, especially in the country, considerably less

in Region XI with regards to the impact of the board bookkeeping

rehearses and its effect on the exhibition of inexpensive food chains, by

the idea of the flow times presented to different mechanical headway and

modern advancement, the specialist might want to set out on this review

and decide the impact of this concentrate in Digos City, Davao del Sur,

Philippines.

Objectives of the Study

This study aims to determine the influence of management

accounting practices on the performance of Fast-food Chains in Digos

City, Davao del Sur. Additionally, this study aims to determine the

following specific objectives.

1. To determine the demographic profile in terms of;

1.1 Age

1.2 Gender Orientation

 1.3 Years of Working in Fast Foods Chains as Managers

1.4 Years of Employment

2. To determine the level of management accounting practices.

3. To determine the level of performance among fast-food chains in Digos

City, Davao del Sur.

4. To determine the influence of management accounting practices on the

performance of fast-food chains.

5. To determine the challenges faced during the application of

management accounting practices.

Significance of the Study

This study will be conducted to know the management accounting

practices and their impact on the fast-food chains in Digos City. Moreover,

this study is significant for the Accounting Students/ Accounting

Professionals as the findings of this research will provide insights, such

as management accounting issues and their practices are covered. These

will open them to understand the impacts of Management accounting

practices and examine the various relationship and connections which

affects the Fast-food chains within the locality. On the other hand, for the

Future Researchers they will be guided by this study as a basis for their
studies. Especially about the details that are extremely difficult to

navigate, it will be a step easier for them to gather background

information that can become a foundation of their prospective result.

Lastly, the Fast food Chain Managers/Owners are beneficial

especially to the Fast-food chain managers, as it will provide quantitative

data as the basis for the formulation of policies, guidelines, and programs

that would enhance the performance of fast-food chains, particularly in

Digos City.

Scope and Limitation of the Study

This study will focus on determining the influence of management

accounting practices and its impact on fast-food chains in Digos City,

Davao del Sur. The scope of the study was the various fast-food chains

that are present and limited to the locality of Digos City, Davao del Sur.

There are many participants in the study namely McDonald’s Digos,

Jollibee (Rizal Avenue, Quezon Avenue, Lim St.), Jolly Beaver, Wingsane

Digos City, Port Café, Pud’s Café and Resto, Oceanic Restaurant,

Chowking, Southwing Cafeteria Digos, Mang Inasal (Grand Mall and

GMall), Nanay’s Cuisine, Chicken Express Fried Chicken BBQ and Short

Orders and more. The duration of the study is estimated to be 4 months.

 Definition of Terms

The following terms are used to provide clarification on the

important terms that are used in this study:

Terms Definition

Managers Refers to a person who leads an organization’s

employees or operations. Ensuring the organization's

productivity and progress.

Management Accounting Alludes to the most common way of social event and

revealing information on financial movement inside

organizations for chiefs to use in arranging, execution

evaluation, or functional administration.

Accounting Employees These are the people working in the Accounting of an

organization or company.

Management Accounting This is defined as the system, methods, procedures,

Practices or rules that are used to gain important or valuable

information that can help control, measure

performance, cost and make good decisions that can

help support the organization’s growth.

Business Performance Refers to an organization’s ability to achieve the

goals that have been planned in the time frame

 given.

CHAPTER II

REVIEW OF RELATED LITERATURE

Management Accounting Practices

Management accounting is the practice of using accounting and

financial management concepts to generate, protect, and grow wealth for

the shareholders of profit and non-profit organizations in the public and

private sectors. In a nutshell, management accounting is concerned with

intra-business data and its measurement for organizational control and

growth. According to (Sunarni 2013) management accounting is a practice

directed toward management or accounting that is related to the

management function. The recent fast changes in the corporate

environment are having a substantial impact on management accounting

practices and the position of the management accountant in a company.

Management accounting should transition from the administrative to the

strategic levels because its primary goal has always been to improve

organizational performance and profitability by providing important

information for planning, controlling, and decision-making.

Hence, management accounting is made up of the word

"management" and "accounting." All levels of administration in a company

are referred to as "management." The major goal of management

accounting in an organization is to assist management in carrying out

their duties by collecting, processing, and sharing information. Accounting

is a broad term that encompasses more than just a record of company

transactions (Hilton and Platt 2011). Because of its many methods,

visions, and analyses, management accounting is a renewable science.

Like a modern science that is constantly updating, it also plays an

effective and influential role in assisting managers with planning,

monitoring, performance evaluation, and making appropriate decisions.

As ideas, dimensions, methodologies, and frameworks changed to

meet the requirements of the modern period and the demands of

businesses, management accounting began to transition from a

conventional to a contemporary approach. Hence, management

accounting has been vital for both production and service facilities in this

regard from the beginning until now. Management accounting methods

have advanced significantly in recent years, especially within the

framework of accounting software (Akmeşe and Bayrakçı, 2016).

Management accounting Practices have not been widely embraced in

nations in development.

However, as the value of these behavior grows firms in poor

nations are encouraged to use MAPs (Bakhsh, et. Al 2019). As a result of

these developments, management practices have been improved

throughout time, and organizational structure has altered as well, owing

to increased global competitiveness (Otley, 2016). It is stated Ahmad &

Leftesi (2014) that Financial and non-financial techniques have been

incorporated into current management accounting practices (MAPs) to

provide information at both the operational and organizational levels,

including factors such as competition, perceived environmental

uncertainty, production, the environment, technology, and business

society. Managers must adapt to management accounting due to

significant problems and demands.

Moreover, management accounting procedures use a combination

of financial and non-financial methodologies to deliver crucial information

at both the organizational and operational levels (Ahmad, 2017). It allows

a company to do more accurate cost control, which improves operational

performance. (Uyar, 2019). By utilizing MAPs, a company may successfully

manage and control its business resources while optimizing earnings,

resulting in a profitable organization. (CIMA, 2015). However, because of

the ongoing changes in the market, the question of which MAPs are

necessary to develop or sustain a competitive edge in the market is

difficult for firms. (Joshi & Li, 2016).

Costing

In an organization, cost communicates how much cash that is spent

on the creation or formation of a decent or administration. With this,

bookkeeping, genuine expenses of tasks, cycles, divisions, or items are

recorded in cost accounting. Throughout the course of recent years,

experts, specialists, and scholarly examiners have seen that costing

strategies, created to further develop choice support and the precision of

cost-and benefit estimation frameworks, again and again have yielded not

exactly the ideal outcomes according to Lawson (2009).

In addition, according to Vanderbeck (2013), significance of cost

accounting to the activity of a business has for some time been perceived.
Consequently, in the worldwide financial climate, for example, information

is more significant than any time in recent memory. An information on

how cost of shift with various degrees of action is fundamental for

dynamic movement might be estimated as far as units of creation or

deals, hours worked, miles voyaged, or some other proper proportion of

the action of an association (Drury, 2013).

Budgeting

The demonstration of planning is a major part of monetary

information action. Planning is the act of apportioning limited assets to an

association's focused on needs. A significant preparation and appraisal

instrument. Planning permits instructive objectives and projects to be

converted into monetary asset plans; for instance, planning an informative

arrangement to fulfill understudy execution objective. However, cash

planning, then again, is the demonstration of submitting reserves or on

the other hand assets throughout an extensive stretch of time for specific

reasons that are steady with the company's essential position sought to

be firmly connected with choosing monetary allotments (Fabozzi, et. al,

2021).

As demonstrated by Qayyum, et. al (2020), the money related

presentation of the fact that there are makes steady endeavors reviewed
observationally assumed various components which impact the money

related show of the multi-reason cooperatives. Some of them are fragile

organization, which makes a few issues of lacking resource segment in

their usage; high advance upsetting and low liquidity level. Successful

planning requires a connection between informative objectives and

monetary preparation, which works on monetary and helpful responsibility

assessment as per Chun and Johnson (2021).

Budget plans have generally assumed a key part in administration

control; in any case, as of late they have turned into the subject of

significant analysis and discussion. Some contend that then issues with

planning stem from how spending plans are utilized (Abogun, &

Fagbemi, 2011) while others contend that planning processes are

generally defective (Réka, Ştefan, & Daniel, 2014). It appears to be

challenging to acknowledge that so many associations would keep on

utilizing planning for control purposes (i.e., for administrative inspiration

and execution assessment) assuming it was essentially defective (Reka,

2014)). Either past examination demonstrating broad utilization of

planning by and by (Libby, & Lindsay, 2010) is presently not exact and

additionally planning rehearses have developed.

 In any case, other than Becker, Mahlendorf, Schäffer, and Thaten,

(2016) working paper, there is almost no new proof in regards to whether

and how firms are adjusting their planning frameworks. Further, there are

models in the writing in which exceptionally fruitful firms use planning

widely for both preparation and control (Libby, & Lindsay, 2010). One can

ask why these organizations have been so effective and inventive on the

off chance that planning is intrinsically imperfect.

Information for Decision Making

Business generally need information as data to get the state of

clients, providers, workers, contenders, and the pioneering climate so

business can stay cutthroat (Byukusenge, Munene & Orobia 2016).

Accomplishing the place of development and working on an organization's

presentation against rivals are the two principle targets of business

associations that the organization should attempt to accomplish.

Organizations that enjoy a benefit as far as items, cost and quality will

unquestionably be serious so their items will be purchased by their clients.

This can expand deals and promotion advancing the organization's

business execution. This condition is upheld by a few outcomes found by

Meutia and Ismail (2013), Rahman and Ramli (2014) and Mzoughi, Bahri,
and Ghachem (2008) who express that superiority can fundamentally

further develop business execution.

Chakravarthy in Mustikowati and Tysari (2014) proclaims that

organization execution is a develop ordinarily to quantify the effect of

procedure direction on the organization. As an all encompassing business

procedure, lean reasoning, accordingly, includes a significantly impact in

outlook that stretches out past activities. Specifically, the board

bookkeepers ought to be essential for the lean change group since they

are accused of providing tasks staff and leaders precise, fitting, and

opportune inward data. As a basic help work, lean administration

bookkeeping rehearses (MAP) give the monetary control vital for inner

decision making in lean associations.

An exact inquiry that has not been explained is the job lean MAP

have in a lean assembling climate and whether tasks the board should be

worried about the execution of lean bookkeeping rehearses. The reason

for this study is to shed bits of knowledge on these issues.Pelham and

Wilson in Mustikowati & Tysari (2014) characterize organization execution

as an effective new item in the market creating. where execution can be

considered through deals development and portion of the overall industry.

Fullerton et al. (2013) exactly exhibited that the degree of a lean

assembling execution was connected with a bundle of five MAP.They

presumed that lean firms depended more on lean MAP, including

streamlined, vital MAP, visual execution estimation, strengthening of

workers, and VSC; and depended less on customary stock following.

CONCEPTUAL FRAMEWORK

Independent Variable Dependent Variable

Management

Accounting Practices

 Costing
Fast Food Chain
 Budgeting
Performance
 Information for

Decision Making
 Figure 1. Schematic diagram of the variables of the study.

CHAPTER III

METHODOLOGY

Research Locale

This quantitative study will be conducted in fast-food chains in

Digos City, Davao del Sur.

Figure 2. Location of Digos City, Davao del Su
 20

Figure 3. Location of Fast-Food Chains in Digos City, Davao del

Sur

Research Design

This study will use the descriptive-correlational research design. As

indicated by Williams (2007) descriptive research is an examination

strategy that can decide the circumstance in current peculiarity. Likewise,

Walliman (2011) characterizes that distinct exploration connects with a

perception in gathering the information. Furthermore, the goal of

 21

correlational study is to see whether there are contrasts in the attributes

of a populace relying upon if its subjects have been presented to an

occasion of interest in the naturalistic setting (Lau, 2016). Thus, engaging

descriptive correlational design is the division of information not set in

stone to describe a gathering or an example relationship of two factors

that might have a relationship to each other. In such manner,

correlational plan will support deciding the connection between elements

of management accounting practices and the performance of fast-food

chains.

Respondents of the Study

This study will employ complete enumeration of the respondents

since the study will target are the managers specifically in fastfood chains

as research respondents of the study. Total enumeration will be the

sampling tool so that no respondent will be excluded from this study.

Sampling Technique

This study aims to determine the significant relationship of

management accounting practices and the business performance of fast-

food chains. Thus, this study will employ complete enumeration as

 22

sampling technique since the respondents of the study will be the

managers in the fast-food chains.

Research Instruments

This study will utilize review polls that are fitting for the review's

objectives. The overview will be utilized to gather information,

guaranteeing that no conceivable respondent is avoided with regard to the

review. The study of Akmese and Bayrakci (2016) entitled “ A Research on

Use of Management Accounting Tools and Techniques in Fastfood

operations: The Case of Konya” for the management accounting practice

namely for Information of Decision Making, the study of Sarah afoakwah,

Isaac Ofori Bonsu, Collins Gyamfi Adae, Emmanuel Kwaku Owusu,

Margaret Konadu Agyarko (2018) entitled “ Adoption of Management

Accounting Practices and its Impacts on the Performance of Some Public

Health Care Instutions within the Kumasi Metropolis ” for the management

accounting practices namely costing and budgeting and the study of Reza

Ghasemi, Noor Azmi Mohamad, Meisam Karami, Norkhairul Hafiz Bajuri

and Ezzatollah Asgharizade (2015) entitled “The Relationship among

Strategy, Competition and Management Accounting Systems on

 23

Organizational Performance” for business performance which will be the

adopted questionnaires of the study.

Likert Scale on the Factors of Management Accounting Practices

namely; Costing, Budgeting, Information for Decision Making for
fast-food chains in Digos City, Davao del Sur

NUMERICAL RANGE OF VERBAL DESCRIPTIVE

SCALE MEANS DESCRIPTION INTERPRETATION
This implies that the respondent
5 4.5-5.0 Very Often applies the management
accounting practices very often.

4 4.0-4.4 Often This implies that the respondent

often applies the management
accounting practices.

3 3.1-3.9 Sometimes This implies that the respondent

sometimes applies the
management accounting
practices.

2 2.1-3.0 Rarely This implies that the respondent

rarely applies the management
accounting practices.

1 1.0-2.0 Never This implies that the respondent

never applies the management
accounting practices.
 24

Likert Scale on the Factors on Performance level of fast-food

chains in Digos City, Davao del Sur

NUMERICAL RANGE OF VERBAL DESCRIPTIVE

SCALE MEANS DESCRIPTION INTERPRETATION

This implies that the respondent

5 4.5-5.0 Very High highly felt that this affects the
performance of the business.

4 4.0-4.4 High This implies that the respondent

felt that this affects the
performance of the business.

3 3.1-3.9 Moderate This implies that the respondent

either/or not considers that this
affects the performance of the
business.

2 2.1-3.0 Very Low This implies that the respondent

does not feel that this affects the
performance of the business.

1 1.0-2.0 Low This implies that the respondent

never felt that this affects the
performance of the business.
 25

Data Gathering Procedures

To obtain the validity of the study the researchers will be using

these following procedures below:

1. Preparation and Validation of the Research

Questionnaire. The review poll will be endorsed and contextualized with

the assistance of the exploration counselor prior to being conveyed to the

examination study's respondents. We will utilize a web-based survey to

guarantee that we can contact bookkeeping staff in cooperatives at their

recreation.

2. Requesting permission to conduct the survey. The

researcher will request consent from the President from Davao del Sur

State College to direct the review entitled ”MANAGEMENT ACCOUNTING

PRACTICES AND THE PERFORMANCE OF FAST-FOOD CHAINS IN DIGOS

CITY DAVAO DEL SUR.”

3. Regulation of the Instrument. To contact the respondents,

the analyst will lead the review utilizing a genuine study.

4. Retrieval of the Survey Questionnaire. The researcher will

wait for the respondents to answer the survey instrument.

 26

5. Tabulation Analysis and Interpretation of Results. The

data will be tabulated and interpreted by the researcher to comply and

answer all the purposes of the study.

Statistical Tools

To have the option to dissect the information accumulated from our

regarded respondents, coming up next are the measurable instruments to

be utilized in this review.

1. Mean - will be utilized to quantify the degree of

management accounting practices and the

performance if of fast-food chains.

2. Standard Deviation - will be utilized to compute the scattering of

the informational index from the information

accumulated from the examination

respondents.

3. Pearson Correlation Coefficient - will be utilized to quantify the

relationship of management accounting

practices and fast-food performance.

 27

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 30

APPENDIX I

MANAGEMENT ACCOUNTING PRACTICES AND THE

PERFORMANCE OF FAST-FOOD CHAINS IN
DIGOS CITY DAVAO DEL SUR.
QUESTIONNAIRE

The purpose of this survey is to gather information on the influence

of management accounting practices and business performance on fast-
food chains. This research is academic in nature and is intended to fulfill
the requirements of the Davao del Sur State College's BS Accounting
Information System degree. The information will remain private. Your
response will be much appreciated.

Demographic Profile
Age ________
Gender_________
Years of Employment _________

Business Profile
Number of years in business ______________
Legal form of business organization_____________
Source of capital _____________
Number of employees ______________
Gender distribution _________________
Status of employment _______________

Please indicate the frequency of usage of the listed practices in your

organization. Use a scale of 1 to 5 where 1 = never, 2= rarely, 3=
sometimes, 4 = often, 5= very often
 31

Costing 1 2 3 4 5
1. Costing methods are used in the acquisition of assets.
2. Costing methods are considered in ascertaining the total
cost of the organization.
3. Costing system are used in the organization to be cost
effective and efficient.
4. Costing systems are used in my organization to increase its
revenue.
Budgeting
5. Budgeting system is used in the acquisition of assets.
6. Budgeting is used in the organization in catering for
unforeseen expenditure.
7. Budgeting is used in the organization to control future cost
8. Budgeting is used in achieving financial target of the
organization.
9. Budgeting is used in assessing the future performance of
the organization.
10. Budgeting is used to know the organization’s progress
report in meeting policy goals.
Information for Decision Making
11. Cost-volume-profit analysis (break-even analysis) for
major products.
12. Product profitability analysis
13. Customer profitability analysis
14. Stock control models
15. Evaluation of major capital investments
based on discounted cash flow method(s)
16. Evaluation of major capital investments based on payback
period and/or accounting rate of return
17. For the evaluation of major capital investments, non-
financial aspects are documented and reported
18. Evaluating the risk of major capital investment projects by
using probability analysis or computer simulation.
19. Performing sensitivity “what if” analysis when evaluating
major capital investment projects.
20. Calculation and use of cost of capital in discounting cash
flow for major capital investment evaluation.
Management Accounting Practices
 32

Please indicate the frequency of usage of the listed practices in your

organization. Use a scale of 1 to 5 where 1 = low, 2= very low, 3=
moderate, 4 = high, 5= very high

Business Performance 1 2 3 4 5

1. Attainment of target related to productivity

2. Attainment of target related to cost

3. Attainment of target related to quality

4. Attainment of target related to delivery of service

5. Attainment of target related to total assets

6. Attainment of target related to market share

7. Attainment of target related to profit

8. Attainment of target related to return on investment

9. Attainment of target related to new product

introduction

10. Attainment of target related to personnel development

11. Attainment of target related to overall business

performance and practice

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Respondents Signature
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