Value added statements, Managerial Accounting


Are intended to show how much wealth or value has been created by the company’s operations and how the wealth has been shared out to interested groups e.g. shareholders, investors in debt capital, employees, government and the amount retained for re-investment. The value added statement exhibits:

  • How much value has been created by a firm’s own effort?
  • How this wealth has been shared out among stakeholders


The difference between the purchase cost of external material and services and the selling prices of the company goods and services is the value/wealth created by the company itself. This is termed to as value added. Value added statements can provide additional information to senior managers to help them in comparing performance of different divisions.

Posted Date: 12/8/2012 4:58:21 AM | Location : United States

Related Discussions:- Value added statements, Assignment Help, Ask Question on Value added statements, Get Answer, Expert's Help, Value added statements Discussions

Write discussion on Value added statements
Your posts are moderated
Related Questions
FLEXIBLE BUDGETING Flexible budget may be used in one of two ways: Planning and Control. At the planning stage when budgets are set, to reduce the effect of uncertainty. For ex

As an MBA Managerial Accounting Student, John has asked you to evaluate the alternatives available and make recommendations as to the best course of action, and present it in a Rep

Find the value of the following: a.    If the total assets are Rs. 87,000 and the liabilities are Rs. 47,000, find out the amount of capital. b.    If the capital of propriet

what are the different arguments against direct materials, direct labor, and factory overhead

Implementation of ABC analysis The following steps are included in implementing the ABC analysis: 1. Categorize the items of inventories, establishing the expected use in un

how company apply marginal costing techniques show with an example

The Knapp Company needs to predict the labor cost in producing small carrot patch dolls. The following production information is available: Year Dolls Pr

Stock turnover ratio  Meaning: this ratio establishes a relation ship between costs of goods sold and average inventory. Objective: the objective of component of this r