Managerial Accounting, MBA, Fall 2010 Ale Imran Siddiqi, FCA, FCMA, FCIS, FPA Institute of Business & Management (IB&M) UET, Lahore Course Introduction Managerial Accounting (MBA) MBA – Evening Spring – 2011 Instructor: ALE IMRAN SIDDIQI, - Chartered Accountant FCA, - Fellow Institute of Chartered Accountants of Pakistan FCMA, - Fellow Institute of Cost & Management Accountants of Pakistan FCIS, - Fellow Institute of Corporate Secretaries of Pakistan FPA, - Fellow Institute of Public Accountants of Pakistan Contact Info.: Phone: 0300-8491775 Email: [email protected][email protected]Office Hours: Instructor MBA Evening (Every Sunday: 6:15 PM to 09:15 PM) IB&M Intranet Path: None Text: Ronald W. Hilton, Managerial Accounting: Managerial Accounting,7 th edition, Publisher The McGraw-Hill Companies, Inc., 2008. Reference: Ronald W. Hilton, Cost Accounting, 6 th Edition, Publisher The McGraw-Hill Companies, Inc., Williams, Haka & Bettner, Financial & Managerial Accounting, McGraw Hill, Boston, 2008. Course Introduction Revision: 0 Page 1/9
Institute of Business & Management (IB&M)UET, Lahore
Course Introduction Managerial Accounting (MBA)
MBA – Evening Spring – 2011
Instructor: ALE IMRAN SIDDIQI, - Chartered Accountant
FCA, - Fellow Institute of Chartered Accountants of PakistanFCMA, - Fellow Institute of Cost & Management Accountants of PakistanFCIS, - Fellow Institute of Corporate Secretaries of PakistanFPA, - Fellow Institute of Public Accountants of Pakistan
Managerial Accounting is an important part of any organization's "Management Information System". All organizations have goals, and their managers need information as they strive to attain those goals. Information is needed for the management function of decision making, planning, directing operations. Managerial Accounting is an integral part of the management process, and the Managerial Accountants are important strategic partners in an organizational team, who can contribute significantly to success of any enterprise.
This course covers basic materials on terminology and ideas on cost behaviour, cost-volume profit relationships, activity-based costing, job-order costing, process costing, budgeting, variance analysis, income effect of direct costing versus absorption costing, and simple non-routine decision making.
Course Objectives:
This course provides an introduction to the fundamental concepts of managerial accounting. The focus of the course will be on the accounting function internal to organizations. Managerial accounting is concerned with the analysis of and accounting for costs, managerial planning, decision making and control. The nature and behaviour of costs and the usefulness and limitations of accounting data for these purposes are studied. Managerial accounting, while providing some data for financial statements prepared for external users, has as its primary purpose the development and presentation of information useful to internal management for decision making, planning and control.
The learning objectives for the students would be to learn and understand as to how:
1. To provide information for decision making and planning and proactively participating as part of the management team in the decision making and planning processes.
2. To assist managers in directing and controlling operations.3. To motivate managers and other employees towards the organization's goals.4. To measure the performance of activities, subunits, managers and other employees with
the organization.5. To assess the organization's competitive position and working with other managers to
ensure the organizations long run competitiveness in its industry.
What is expected from you:
You are required to work hard and use critical and analytical approach towards this subject of Managerial Accounting. This subject will certainly equip you with essential management accounting techniques, which will help you execute projects with professional acumen cum managerial approach. Therefore, your class participation and full attendance is necessary for complete understanding of the whole concept of Managerial Accounting. Professionalism and dedications are recommended! There is a need to follow ethical standards - education is our primary goal here, your willingness coupled with endeavour to learn will earn you a good grade. Anyone having difficulties should contact me personally.
Attendance will NOT be over-written once taken unless you can prove circumstances beyond your control that prevented you from joining the class in time. Your attendance will be used for determining a portion of class participation grade.
Please follow the basic ethics of class participation, any misbehaver in terms of late coming, conduct, attendance, and use of mobile phones during the lectures will not be tolerated.
Homework / Assignments / Quizzes:
While completing the assignments/ homework/ quizzes, please use only one side of the page (standard for this class is 12 font, times new roman, single spaced along with title sheet containing your name, roll#, section, and date of submission.) a good presentation is essential and will earn you better marks. Ensure that your work is prepared neatly and logically.
I will accept homework by the start of class on the day it is due, unless stated otherwise. Make it your business to do your work on time and hand it on time. ASSIGNMENTS SUBMITTED LATE WILL NOT GET YOU FULL MARKS. It is your duty to ensure that you produce your original work. Otherwise, I will be inclined to use negative marking and appropriate disciplinary action.
Grading:
The final grade for the course will be determined based on the total points accumulated in the below areas:
Mid-Term ExamThere will be a mid-term exam that will include questions on course content covered up to that time. It will contain both objective and descriptive type of questions.
Final ExamThere will be a comprehensive final exam at the end of the semester on which students will be tested on the course contents covering full syllabus. This final exam will consist of 40% marks and the questions asked will include both objective and descriptive type of questions.
Team Project / Presentation:
A team project from a real world situation will be given to you so that you can use your knowledge of the subject and correlate it with your studies. What is expected that you cover all the aspects of Managerial Accounting in your project report and deliver a class presentation for your solution. You are required to use Microsoft Office to prepare your project report/presentation/solution. You are also required to submit a hard copy of the presentation before starting your actual presentation. Questions answers session will take place at the end of the presentation to which entire team is required to take part in. Related goals of the team project is to include the development of skills in teamwork, intra-group dynamics, professional report writing (i.e. proper layout, grammar and spelling), and report presentation/public speaking. The details of the project and structure of the group will be given later.
All group members must also complete a confidential peer evaluation that measures the performance of each group member. Students found to have significantly lower evaluations from their peers may have their case study analysis/project marks downgraded proportionately.
The Changing Role of Managerial Accounting in a Dynamic Business Environment, Decision Making, Planning; Directing Operational Activities, Managerial versus Financial Accounting, Major Themes in Managerial Accounting; Professional Ethics.
Managerial Accounting, By Ronald W. Hilton, 7th Edition Chapter 1
Wk 2 20-2-11
Basic Cost Management Concepts and Accounting for Mass Customization Operations. Product Cost, Period Costs and Expenses, Costs on Financial Statement, Income Statement, Balance Sheet, Manufacturing Cost.
Chapter – 2
Wk 3 27-2-11
Manufacturing Costs Flows; Variable and Fixed Costs. The Cost Driver Team. Product & Service Costing, Flow of Costs in Manufacturing firms.
Chapter – 3
Wk 4 6-3-11
Job Order Costing system & Process Cost System; Direct Material; Direct Labor & Application of Manufacturing Overhead; Project Costing; Job Order Costing in None Manufacturing Organizations.
Chapter – 3
Wk 5 13-3-11
Process Costing and Hybrid Product-Costing Systems; Equivalent Units. Actual Costing versus Normal Costing. Process Cost Sheet. Weighted Average Method of Process Costing. Hybrid Product Costing System; Operational Costing for Bateh Manufacturing Processes.
Chapter – 4
wk 6 20-3-11
Activity Based Costing System & Activity Based Management, Cost Drivers. Collection of ABC Data. Why Traditional Volume Based System distort Product Costs, Ethical issues surrounding ABC.
Chapter – 5
wk 7 27-3-11
Cost Management Tools; Target Costing; Kaizen Costing; Bench Making; Reengineering’ theory of constraints; just in time inventory & production management.
Chapter – 6
wk 8 3-4-11 Mid –Semester Exam
wk 9 10-4-11
Activity Analysis, Cost Behavior, and Cost Estimation; Cost Behavior Patterns; Variable costs; step variable costs; fixed costs; step fixed costs; semi variable costs; using cost behavior patterns to product costing
Chapter – 7
Wk 10 17-4-11(Make-up
class)
Cost-Volume-Profit Analysis, The Breakeven Point; Contribution Margin Approach, Target Net Profit/ CVP Analysis with Multiple Products; Traditional Income Statement and Contribution Income Statement; Cost structure & operating leverage.
Chapter – 8
wk 11 24-4-11 Profit Planning, Activity-Based Budgeting, and e-Budgeting; type of Budgets’ the master budget; operational budgets; capital expenditure budget;
budgeted financial Statements; Using Activity based Budgeting to prepare the Master budget, cash budgets’ zero based budgeting; budgetary slack & padding of the budgets; flexible budgeting
Chapter – 11
wk 12 1-5-11
Standard Costing, Operational Performance Measures, and the Balanced Scorecard’ management by exception; methods of setting standards; cost variance analysis; significance of cost variances; controllability of costs variances, standard costs & product costing
Chapter – 10
wk 13 8-5-11 Project Presentations
wk 14 15-5-11Responsibility Accounting, Quality Control, and Environmental Cost Motivating Decision Behavior; Segments versus Segment Managers.
Chapter – 12
wk 15 22-5-11
Investment Centers and Transfer Pricing; return on investment; residual income; invested capital; goal congruence; decision making; relevant costs & benefits; absorption costing; variable costing; throughput costing
