Upon successful completion of the course the student will be able to:
1. Explain the difference between financial and managerial accounting, the role of managerial accounting and the primary informational needs of managers.
2. Define various cost terms and explain their use for different decision purposes.
3. Explain cost behavior and perform cost-volume-profit analysis and use it as a predictive tool.
4. Complete operational budgets including the flexible budget and explain their role in planning and controlling operations and costs.
5. Identify and use relevant costs in making decisions including capital budgeting decisions which incorporate the use of time value of money techniques.
6. Describe the development and use of standard costs.
7. Prepare and interpret variance reports and relate it to responsibility accounting and cost controls.
8. Explain the difference between short-range and long-range planning and analytical tools and identify when each would be used.
9. Apply financial analysis tools and demonstrate understanding of financial statement information.
10. Apply analytical, interpersonal, and communication skills in problem solving.
I. Introduction to Management Accounting
A. Role of financial versus managerial accounting
B. Careers in managerial accounting and professional ethics
C. Emerging issues in business and non-business organizations
D. Learn critical thinking skills, analytical skills, interpersonal and collaborative skills, and the ability to write business reports.
II. Basic Cost Terms and Concepts
A. Product and service costing
B. Cost classifications -- different costs for different purposes
C. Financial statement cost classifications
D. Economic cost classifications
E. Cost management in traditional and new manufacturing environments
F. Introduction to Job Order and Process costing systems
III. Cost Behavior and Estimation
A. Cost behavior patterns and definitions
B. Cost estimation methods
C. Cost predictions using behaviors
IV. Cost Volume Profit Analysis
A. Break-even point
B. Contribution margin
C. Target profit planning
D. Multi-product profit planning and effects of sales mix
E. Contribution format Income Statement and CVP analysis
F. Effect of activity-based costing on CVP analysis
V. Variable Costing
A. Absorption versus Variable Costing
B. Traditional versus contribution format Income Statements
C. Effect of change in production on income
D. Internal versus External reporting
E. Impact of JIT methods
VI. Operational budgets: The Master Budget
A. Purposes and types of budgets
B. The master budget as a planning tool
C. Assumptions and predictions used in the master budget
D. Behavioral impact of budgets
E. Preparing and using flexible budgets for the control of over-head costs
VII. Standard Costing and Variance Analysis
A. Setting standards and controlling mfg costs
B. Standards use in nonmanufacturing organizations
C. Cost variance analysis: materials, labor & overhead
D. Controllability of variances
E. Standard costs and Product costs
F. Advantages of standard costing systems
G. Standard costing systems in the new mfg environment
VIII. Responsiblity Accounting and Performance Evaluation
A. Performance reports: cost, profit and investment centers
B. Segmental income reports: preparation and use
C. Behavioral effects of responsibility accounting reports
IX. Decision Making
A. Identifying relevant costs and benefits
B. Special decisions: i.e. special orders, make/buy, add/drop
C. Behavioral issues in decision making
D. Use of qualitative facts in decision making
E. Risk aversion
X. Capital Budgeting Decisions
A. Discounted cash flow analysis
B. Choosing the hurdle rate
C. Comparing two investment projects
D. Post audit procedures
E. Effect of income taxes on capital budget decisions
F. Other investment decision methods
G. Ranking investment projects
XI. Financial analysis
A. Statement of Cash Flows: Preparation and Interpretation
B. Comparative and common-size financial statements
C. Ratio analysis: The common stockholder
D. Ratio analysis: The short-term creditor
E. Ratio analysis: The long-term creditor