Module                       : ACT 203: Accounting for Managers-II

Programme                : BBA

Credit Value              : 12

Prerequisite                : Module 101,201 Accounting Principles

General Objectives:

• To understand basic concept, processes used to determine cost.
• To gain knowledge of preparation of budgets, standard costs and variance statements.
• To gain skill for controlling cost and decision making.

Learning Outcomes:

Upon successful completion of the module, student is expected to:

• Discuss the basic concepts and processes used to determine cost
• Demonstrate the preparation of budgets, standard costs and variance
• Apply the skills in standard costing and techniques of variance analysis

CONTENT

Unit-I: Understanding Costs                                                                                             (5 Hours)

Introduction, Meaning of Cost, Cost elements, Functional classification, and Understanding value chain, Direct and Indirect costs, Preparation of Cost sheet

Unit- II:  Cost Volume Profit Analysis                                                                           (15 Hours)

Introduction, Classification by Variability: Fixed Cost, Variable Costs, Semi-Variable Cost; Marginal Costing and Break Even Analysis: Profit Volume Ratio, BEP, Break Even Volume and Margin of Safety; application of Marginal Costing Concept.

Unit- III:  Standard Costing and Variance Analysis                                                    (15 Hours)

Introduction, Meaning of Standard Costs; Material Standards and Variance Analysis, Labour Cost Standard and Variance Analysis, Overhead Standard and Variance analysis, Sales variance analysis.

Unit- IV: Budgetary Control                                                                                          (15 Hours)

Introduction, Long Range Planning and Master Budget; Master, Continuous Budget, Components of Master Budget, Advantages of Master Budget, Preparation of Master Budget (Sales, Production, Material Requirement, Production Cost and Financial Budgets), Flexible Budget and Zero Based Budgeting;

Teaching Strategies

• Lecture method
• Mini Case study
• Demonstration
• Group works

Assessments

• Assignments/Project work /Presentation        30 %
• Examination                                                     70 %

                                                                  Total  100 %

Essential Texts

1.         Arora, MN, Cost Accounting: Principles and practice. (2008) Noida (UP): Vikash Publishing House Pvt. Ltd.

2.         Horngren, C.T. Cost Accounting, A managerial Emphasis (2008) New Delhi: Horngren, Prentice Hall of India.

References

1.      Ghosh, T.P., Accounting and Finance for Managers, Taxmann Publication, New  Delhi, INDIA   

2.      Saxena, VK and Vashist, CD. Advanced Cost and Management Accounting , Delhi: Sultan  Chand and Sons.

3.      Jain, Narang. Cost Accounting. Kalyani Publishers

4.      Allen, BR,  Cases in Management Accounting and Control Systems, 4/e (2008), Pearson Publications INDIA.