MANAGEMENT ACCOUNTING

MANAGEMENT ACCOUNTING
AREA OF STUDY: CORE
BAC 233

Year: 2
Semester: 4

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* Continuous
** Duration: 3 hours

Unit 1: Introduction L. H. 4
1. Nature, Scope, Objectives and Principles of Management Accounting
2. Relationship between Financial Accounting and Management Accounting
3. Relationship between Cost Accounting and Management Accounting
4. Advantages and Limitations of Management Accounting
Unit 2: Income Recognition, Measurements and Reporting L. H. 6
1. Absorption Costing: Concept, Methods and Limitations
2. Variable Costing: Concept Methods, Pros and Cons
3. Causes of Differences in Net Income under Two Methods
Unit 3: Cost Volume- Profit analysis L. H. 8
1. Introduction and Assumptions of CVP Analysis
2. Application of Cost-Volume Profit Analysis
3. Contribution Margin and Equation Approach to BEP
4. Safety Margin & Graphical Approach to BEP
5. Break Even Application and Cash Break Even Point
6. Step-Fixed Cost and BEP of the Multi Products Firm
Unit 4: Decision Regarding Alternative Choices L. H. 6
1. Introduction, Tactical Decision Making process
2. Types of Decision: Make of Buy, Special Order, Drop or Continue Sell or Further Process.
Unit 5: Capital Budgeting Decisions L. H. 10
1. Introduction and procedures of Capital Budgeting
2. Calculation of Cash Flow Stream
3. Calculation of Differential Incremental Net Cash Flow Stream
4. Calculation of Net Cash Outlay
5. Calculation of Depreciation and CFAT
6. Techniques for Evaluating Investment Proposals
Pay Back Period, Average Accounting Rate of Nature
Net Present Value Method, Internal Rate of Return
Unit 6: Budgets for Planning L. H. 8
1. Meaning of Budgeting and Budget, Purpose, Advantages and Limitations
2. Functional Classification of Budgets and their Preparation: Sales Budget, Production Budget, Purchase Budget, Production Cost Budget, Cash Budget.
Unit 7: Responsibility Accounting L. H. 6
1. Concept of Responsibility Accounting
2. Responsibility Centers: Cost Center, Revenue Center, Profit Center, Investment Center
3. Process of Responsibility Accounting
4. Role of Responsibility Accounting
5. New Concepts in Responsibility Accounting
Suggested Readings :
1. Horngren CT: Introduction to Management Accounting
2. Anthony and Reece: Management Accounting
3. Ray H. Garison: Managerial Accounting, Concept for Planning, Control & Decision Making 6th Edition Irwin, Boston
4. Khan, MY and Jain PK: Management Accounting
5. Shing, Yamesh Man: Ojha Khagendra & Acharya Chiranjibi Cost & Management Accounting
6. Dr. Gupta S. P. Management Accounting
7. Lynch & Williamson: Accounting for Management