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Administrative Information

Course Name: Managerial Accounting & Control System

Course Code: ACC502

Credit Hours: 3 Credit hours

Course Prerequisites: ACC101, ACC302

1. Course Description: An introductory course providing an overview of the managerial use of financial and nonfinancial information for a variety of purposes including managerial decision analysis, external financial reporting, strategic product costing, organizational planning, and performance evaluation. The emphasis is on developing and using information to support value creation by management. The course is divided into three parts: Part A. Cost Analysis for Decision-Making This part involves an introduction to basic cost concepts and explores the analysis of financial and nonfinancial information to evaluate the economic impact of decisions to acquire and deploy resources. It involves a framework for analyzing both short-term and long-term decisions that include incremental, sunk and opportunity costs. Part B. Cost Measurement Systems The primary focus of this part is to delineate the cost flow architecture used in cost measurement comprised of cost accumulation, cost allocation, and cost application systems. A distinction is made between the measurement principles used in cost accounting for external financial reporting purposes and those used in activity-based systems required for product costing and to support strategic initiatives. Part C. Cost Planning & Control Systems This part describes how organizations develop and use budgets for planning and expenditure control. A comparison is made between top-down long-term financial planning and bottom-up short-term budgeting. Various approaches to budgeting are introduced including static, flexible, functional, and activity-based budgeting. Students are also exposed to the design and use of managerial performance evaluation systems

2. Course Objectives: Managerial Accounting is the process of identifying, measuring, analyzing, interpreting and communicating information in pursuit of organizational goals. It is an integral part of the management process and mangers regularly need the information generated through it to make decisions.

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3. Learning Outcomes:.

On satisfying the requirements for this course, students should have the knowledge and skills to

LO1. : analyze and provide recommendations to improve the operations of organizations through the LO2. application of management accounting techniques; LO3. apply techniques associated with costing systems, cost management systems, budgeting systems and performance measurement systems; LO4.:appreciate the need for a balance between financial and non-financial information in decision making, control and performance evaluation applications of management accounting; LO5. learn independently and to assume responsibility for the learning process;

4. Text Book

Managerial Accounting by Ronald W. Hilton, 5th edition, 2002, McGraw-Hill/Irwin 5. Reference Book/Journals:

Introduction to Financial Accounting. [It is the responsibility of the student to make sure that this prerequisite requirement has been met.] Managerial Accounting, Ray H. Garrison, Eric W. Noreen and Peter C. Brewer, McGraw-Hill Irwin 13th Ed. (2010) Managerial Accounting: An Asian Perspective, Ray H. Garrison, Eric W. Noreen, Peter C. Brewer, Nam Sang Cheng and Catherine C.K. Yuen, McGraw Education (Asia) (2012) 6. Topics/Chapters:

Introduction to Managerial Accounting Costs Terms, Concepts and Classifications Job Order Costing Process Costing Activity Analysis, cost behavior and cost estimation and CVP Analysis Profit Planning & developing Budgets Standard Costing Decision Making - Relevant Costs and Benefits Capital Expenditure & Budgeting Decisions Cost Analysis for Pricing Decisions

7. Teaching and Learning Methodology:

The teaching methodology will comprise of presentations via multi-media, lab work, case studies guest speaker sessions, practical demonstration of literature review

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and referencing style. In order to facilitate the students in writing a well drafted report, 15 minutes will be allocated in every class for the project discussion. 8. Materials and Supplies:

Students should have note books and calculators. Case Studies and handout will be provided. 9. Grading Policy/Student Assessment:

Assessment Instruments Percentage LO Covered

Quiz (3 of 5 mark each) n-1 10 % LO 1,2, 3

Assignment/Presentation/Project 15 % LO1 2,3, 4,

Attendance/Participation 05 % (Awarded by the

Examination dept.)

Midterm Exam 20 % LO 1, 2, 3

Final Exam 50 % LO 1, 2, 3, 4

10. Attendance Policy: Prompt arrival and regular attendance are extremely important. Refer to student handbook for policies on late entry, maximum absences allowed, leave application etc. 11. Expected Class Conduct:

Students are expected to be interactive and class participation is essential for learning. Class code of ethics should be followed like no eating, usage of mobile phones are not acceptable, late arrivals should not be made a habit unless a genuine problem..Class disturbance will not be tolerated. Since the assignments are project based so they should be submitted on time, in order to complete the term project diligently.

12. Weekly Course Outline:

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Week Session Topic

Learning Objectives

1 Introduction to Managerial Accounting

• Managerial functions and Managerial Accounting

• Difference between managerial and financial accounting

• Contemporary themes in managerial accounting

2

Costs Terms, Concepts and Classifications

• What is cost • Different costs for different purposes

• Financial reporting • Predicting cost behavior • Assigning costs to cost objects • Decision making

3 Job Order Costing

• Flow of Costs in a Manufacturing Firm • Distinguish between process costing and

job-order costing • Documents used in a job-order costing

system • Predetermined overhead rates • Understand the flow of costs in a job-

order costing system

4 & 5 Process Costing

• Comparison of Job-Order Costing and Process Costing

• Process Cost Flows • Process costing in Equivalent Unit

Method • Weighted Average Method & FIFO

Method

Quiz # 1

6

Activity Analysis, cost behavior and cost estimation and CVP Analysis

• Relationship between cost estimation, cost behavior, and cost prediction

• Describe the behavior of the following types of costs: variable, step-variable, fixed, step-fixed, semi-variable (or mixed), and curvilinear

• Engineered costs, committed costs, and discretionary costs

• Cost-estimation methods: account classification, visual fit, high-low, and least-squares regression

• Apply CVP analysis to determine the effect on profit of changes in fixed expenses, variable expenses, sales prices, and sales volume.

• Discuss the key assumptions of CVP analysis

7 Profit • Purposes of budgeting systems •

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Since assignments are part of the project/assignment/case study, therefore the marks assigned to them will be added.

One surprise quiz is planned for ensuring the active class participation

Planning & developing Budgets

• Prepare each of the budget schedules that make up the master budget.

• Describe a typical organization's process of budget administration.

8

Mid Term

9 Standard Costing

• Explain how standard costing is used to help manage costs

• Distinguish between perfection and practical standards

• Cost Variance Analysis • Summarize some advantages of standard

costing • Describe the balanced scorecard concept

10 & 11

Decision Making - Relevant Costs and Benefits

• Describe six steps in the decision-making process

• Explain the relationship between quantitative and qualitative analyses in decision making.

• Identify relevant costs and benefits • Analysis of various special decisions

12 & 13

Capital Expenditure & Budgeting Decisions

• Use the net-present-value method and the internal-rate-of-return method to evaluate an investment proposal.

• Compare the net-present-value and internal-rate-of-return methods

• Capital Budgeting Decisions

Quiz 2

14 Cost Analysis for Pricing Decisions

• Describe the four major influences on pricing decisions

• Explain economic, profit-maximizing pricing model

• Set prices using cost-plus pricing formulas

• Discuss issues in the strategic pricing of new products

15 Revision

16 Final Paper

Final Exam

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13. Students with Physical or Educational Challenges:

Students with educational and/or physical challenges are entitled to extra attention and time from the instructor. Therefore students are advised to notify the course instructor at the beginning of the course. Special arrangement may also be made on prior request based on specific challenges. 14. Academic Integrity This course seeks to empower students for independent learning, resourcefulness, clear thinking, and perception. All submitted work and activities should be genuine reflections of individual achievement from which the student should derive personal satisfaction and a sense of accomplishment. Plagiarism and cheating subvert these goals and will be treated according to the policy stated in the Student Handbook. The instructor reserves the right to utilize electronic means to help prevent plagiarism.