COMA-EMBA-20

COMA-EMBA-20
MBA(Exe.) 2020-21: Term-II

Name of the Subject: Cost and Management Accounting

Term: 2

Credits: 3 Credits

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Introduction

Accounting provides a great deal of information for managerial decision making. One needs to understand the process flow of the generation of accounting information for designing the organizational strategy. The course links the generation of accounting information from various organizational activities such as operations, evaluation of performance etc. to the decision making and thereby helps in achieving the organizational goals.

Course Objective

1. To understand the cost accumulation process
2. Examining the link between accounting information and managerial decision making
3. Examine the relationship between cost volume and profit
4. Understanding the performance evaluation using accounting information.

Mapping of course learning outcomes/ graduate attributes, subject learning outcomes and assessments

Course Learning Goals & Outcomes	Subject Learning Outcomes (SLO) On successful completion of this subject, the students will be able to:	Assessment Item
1	Knowledge of business and management	A· Understand the fundamental cost concepts, cost behaviour, cost flows and be able to appreciate linkages with external financial reporting. · Learn measurement and allocation of costs in traditional cost accounting methods like job costing, process costing and be aware of the limitations of the methods. · Measure the interrelationship between the costs, volumes and profits. · Learn how budgets are prepared to plan for future performance. · Use control techniques, like variance analysis and management by exception, for planning and control. · Class Participation · Quizzes · Final Examination
2	Critical Thinking	B· Apply decision making tools like Activity Based Costing. · Identify costs and benefits which are relevant or irrelevant in a decision making scenario involving competing choices · · Quizzes · Final Examination
3	Effective communication Teamwork	C Effectively critique and communicate Cost and Pricing to the relevant stakeholder · Group Assignment · Group Quiz

Method of Evaluation

Quizzes (20%):

The course will have a minimum 3 quizzes. Out of the 3 quizzes 2 will be individual quizzes and 1 will be a group quiz. The mode of conducting the quiz will be communicated during the session.

Individual Project (25%)

The details regarding the group will be shared separately during the course sessions.

Mid-term examination (25%)

Midterm will be conducted separately. It will consist of numerical, conceptual and application-based questions.

End term exam (30%)

End term will consist of the course covered during all the sessions. It will consist of numerical, conceptual and application-based questions.

Session Plan

Session Topic Session Readings Pedagogy

Costing Accumulation

1
Introduction to Cost
· Understand the need for cost management
· terminologies and cost concepts
- Cost, Cost Object, Cost Centre, Cost Unit, Cost Drivers
- · Chapter 1 and 2 · Case discussions
· Exercises
· Simulations

2
Understanding and Computation of Cost Sheet
· Classification of cost based on various parameters
· Prepare Cost sheet and Income Statement

COGM
COGS
COS

· Chapters 1/ 2/ 6

3
Product Costs: Job Costing
· Understanding the Flow of costs in job costing system
· Computation of the pre-determined overhead rate and allocation · Chapter 3 and
· Chapter 17 (pages 774-782)

4
Product Costs: Job Costing
· under-applied or over-applied overhead
· Apportionment of Service department costs using various methods · Chapter 3 and Chapter 17

5
Product Costs: Process Costing
· Understanding the flow of costs in process costing system
· Chapter 4 and Chapter17 (pages 784-787)

6
Product Costs: Process Costing
· Equivalent Units of Production, Cost per equivalent unit using Weighted average method · Chapter 4 and Chapter17 (pages 784-787)

Cost Management

7
Cost-Volume-Profit (CVP) Analysis
· Understanding the Mechanism of CVP relations
· Understand application of CVP, Preparation and interpretation of contribution income statement · Chapters 7and Chapter 6

8
Cost-Volume-Profit Relationships
· Compute contribution margin ratio, break-even point and margin of safety (including multi-product environment)
· Compute degree of operating leverage and understand its relation with margin of safety.
· Chapters 7and Chapter 6

9
Relevant Costs for decision making
· Identify relevant costs and revenues
· Decide whether to accept special order
· Decide whether to make or outsource · Chapter 14

10

Relevant Costs for decision making
· Decide whether to continue or shut down operations/ product line / department
· Ascertain optimal product-mix decision when resources are constrained · Chapter 14

11
Activity Based Costing (ABC)
· Explain and justify Activity Based Costing
· Explain and classify activities by cost levels · Chapter 5

12
Activity Based Costing (ABC)
· Analyze activity costs, identify activity cost pools, select cost drivers
· Compute activity rate and product costs under ABC system
· Compare product costs under Traditional and ABC costing
· · Chapter 5

13
Activity Based Management
· · Case let

Costing Control

14
Standard costing and Variance Analysis (Cost Variances)
· Understand Standard Cost and Standard Costing · Chapters 10 (pages 440-457) and 11(pages 499-510)

15
Standard costing and Variance Analysis (Cost Variances)
· Computation of material, labor and overhead variances

· Chapters 10 and 11

16
Standard costing and Variance Analysis (Cost Variances)
· Mix variance
· Yield Variance
· Idle time variance · Chapters 10 and 11

17
Standard costing and Variance Analysis (Cost Variances)
· Sales variances
· Profit variances · Chapters 10 and 11

18
Budgeting
· Explain the purpose of budgeting system, understand the budget administration and the budgetary slack · Chapters 9 and 11

19
20
Budgeting
· Prepare master budget, explain the interrelationships among its supporting schedules and prepare cash budget
Prepare static and flexible budgets
· Chapters 9 and 11

Prescribed Text Book

Ronald W. Hilton and David E. Platt, Managerial Accounting: Creating Value in a Global Business Environment, McGraw Hill Education Private Limited,

Additional Readings: Articles and Cases

· Cambridge Hospital Community Health Network: The Primary Care Unit V.G. Narayanan, Ryan Moore, Lisa Brem
· Apple Watch (A): The Launch Megan Way, Lidija Polutnik
· Classic Pen Company : Developing an ABC Model
· Destin Brass Products Co.
· Kanthal (A)
· Measure Costs Right:Make the Right Decisions
· Charles T. Horngren, Srikant M. Datar and Madav V. Ranjan (2018), Cost Accounting- A Managerial Emphasis (16th Edition). Pearson Publishing
Created By: Alora Kar on 12/02/2020 at 11:02 AM
Category: MBA(Exe.)2020-21 T-II Doctype: Document

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Session	Topic	Session Readings	Pedagogy
Costing Accumulation
1	Introduction to Cost · Understand the need for cost management · terminologies and cost concepts - Cost, Cost Object, Cost Centre, Cost Unit, Cost Drivers -	· Chapter 1 and 2	· Case discussions · Exercises · Simulations
2	Understanding and Computation of Cost Sheet · Classification of cost based on various parameters · Prepare Cost sheet and Income Statement COGM COGS COS	· Chapters 1/ 2/ 6
3	Product Costs: Job Costing · Understanding the Flow of costs in job costing system · Computation of the pre-determined overhead rate and allocation	· Chapter 3 and · Chapter 17 (pages 774-782)
4	Product Costs: Job Costing · under-applied or over-applied overhead · Apportionment of Service department costs using various methods	· Chapter 3 and Chapter 17
5	Product Costs: Process Costing · Understanding the flow of costs in process costing system	· Chapter 4 and Chapter17 (pages 784-787)
6	Product Costs: Process Costing · Equivalent Units of Production, Cost per equivalent unit using Weighted average method	· Chapter 4 and Chapter17 (pages 784-787)
Cost Management
7	Cost-Volume-Profit (CVP) Analysis · Understanding the Mechanism of CVP relations · Understand application of CVP, Preparation and interpretation of contribution income statement	· Chapters 7and Chapter 6
8	Cost-Volume-Profit Relationships · Compute contribution margin ratio, break-even point and margin of safety (including multi-product environment) · Compute degree of operating leverage and understand its relation with margin of safety.	· Chapters 7and Chapter 6
9	Relevant Costs for decision making · Identify relevant costs and revenues · Decide whether to accept special order · Decide whether to make or outsource	· Chapter 14
10	Relevant Costs for decision making · Decide whether to continue or shut down operations/ product line / department · Ascertain optimal product-mix decision when resources are constrained	· Chapter 14
11	Activity Based Costing (ABC) · Explain and justify Activity Based Costing · Explain and classify activities by cost levels	· Chapter 5
12	Activity Based Costing (ABC) · Analyze activity costs, identify activity cost pools, select cost drivers · Compute activity rate and product costs under ABC system · Compare product costs under Traditional and ABC costing ·	· Chapter 5
13	Activity Based Management ·	· Case let
Costing Control
14	Standard costing and Variance Analysis (Cost Variances) · Understand Standard Cost and Standard Costing	· Chapters 10 (pages 440-457) and 11(pages 499-510)
15	Standard costing and Variance Analysis (Cost Variances) · Computation of material, labor and overhead variances	· Chapters 10 and 11
16	Standard costing and Variance Analysis (Cost Variances) · Mix variance · Yield Variance · Idle time variance	· Chapters 10 and 11
17	Standard costing and Variance Analysis (Cost Variances) · Sales variances · Profit variances	· Chapters 10 and 11
18	Budgeting · Explain the purpose of budgeting system, understand the budget administration and the budgetary slack	· Chapters 9 and 11
19 20	Budgeting · Prepare master budget, explain the interrelationships among its supporting schedules and prepare cash budget Prepare static and flexible budgets	· Chapters 9 and 11