MAFundamentals defines the foundation of Management Accounting from cost concept, classification and analysis. It provides general discussion on COST, VOLUME, PROFIT, VARIANCE and other information necessary for performance measurement, decision making and pricing.

Cash Flow Analysis

One technique in Financial Statement Analysis, Cash flow analysis is a detailed study of the net change in cash as a result of operating, investing, and financing activities during the period.


The Statement of Cash Flows - the basic financial statement prepared and used in analyzing cash flows. The report includes cash receipts, cash payments and the net change in cash. These are results from operating, investing, and financing activities of the company during a certain period.

Cash Flows - include cash and cash equivalent

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Gross Profit Variance Analysis

One technique in the analysis of Financial Statement, Gross Profit Variance Analysis is used to compare actual data (represented here by 200B) with budgeted data, standard data, previous year's data, or base year data (represented here by 200A).

Normally, these involves the Sales Variance and the Cost variance in consideration of the  price and volume or quantity factors.

Discussed here are the four (4) types.


1.) 4-WAY ANALYSIS

Sales Variance:
  • Price factor = difference in selling prices x 200B units
  • Volume or quantity factor = difference in units x 200A selling price
Cost Variance:
  • Price factor = difference in cost prices x 200B units
  • Volume or quantity factor = difference in units x 200A cost price
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