1 UNIT OUTLINE - MANAGERIAL ACCOUNTING SEMESTER I – YEAR 2012 - 2013 1. Unit code: BBUS 1.10 2. Number of credits: 04 3. Prerequisite(s): Accounting, Principles of Economics. 4. Lecturer: Nguyen Phong Nguyen Email: nguyenphongnguyen@ueh.edu.vn Mobile phone: 0948246655 5. Unit description: This unit provides students with an appreciation of management accounting concepts related to the management functions of decision-making, planning and control. Students are introduced to the application of management accounting tools for business decision making, budgetary control and cost management, as well as performance evaluation. 6. Learning outcomes/objectives: On completion of this unit, students will be able to:  Understand basic knowledge regarding managerial accounting and the relationship between managerial accounting and management processes.  Understand costs and cost behavior within the context of business organizations.  Understand how Cost –Volume – Profit relationships can be used to make business decisions.  Understand and use managerial accounting information in various managerial tasks, including profit planning, break-even analysis, making short-term decisions, controlling costs, and evaluating divisional performance.  Understand the importance of ethical behavior of managerial accounting and make decisions in an ethical manner.  Develop independent research and teamwork skills that can be used in real business environments. 2 7. Unit contents CONTENTS Teaching periods Section 1 – INTRODUCTION TO MANAGERIAL ACCOUNTING 1.1. The meaning of managerial accounting 1.2. The objectives of managerial accounting 1.3. Comparison between managerial accounting and financial accounting 1.4. Managerial accounting and ethical conduct 4 Section 2 – BASIC COST CONCEPTS AND CLASSIFICATIONS 2.1. The meaning and uses of cost 2.2. Production costs and non-production costs 2.3. Cost behavior 2.3.1. Variable cost 2.3.2. Fixed cost 2.3.3. Mixed cost 2.3.4. Methods for separating mixed costs into fixed and variable components 10 Section 3 – COST – VOLUME – PROFIT (CPV) ANALYSIS 3.1. Break-even point in units and in sales dollars 3.2. Units and sales dollars needed to achieve a target income 3.3. Multiple-product analysis 3.4. CPV analysis and risk and uncertainty 3.4.1. The margin of safety 3.4.2. The degree of operating leverage 3.5. The underlying assumptions and limitations of CVP analysis 10 Section 4 – SHORT-RUN DECISION MAKING 4.1. Short-run decision-making model 4.2. Relevant costs and benefits, in a variety of business decisions. 4.2.1. Make-or-buy decisions 4.2.2. Special order decisions 4.2.3. Keep-or-drop decisions 4.2.4. Further processing of joint products 4.2.5. Product mix decisions 4.3. The use of cost in pricing decisions 4.3.1. Cost-based pricing 10 3 4.3.2. Target costing and pricing Section 5 – PROFIT PLANNING 5.1. Description of budgeting 5.2. Preparing budgets 5.2.1. Sales budget 5.2.2. Production budget 5.2.3. Direct materials purchases budget 5.2.4. Direct labor budget 5.2.5. Overhead budget 5.2.6. Ending finished goods inventory budget 5.2.7. Cost of goods sold budget 5.2.8. Selling and administrative expenses budget 5.2.9. Budgeted income statement 5.2.10. Budgeted balance sheet 10 Section 6 – STANDARD COSTING AND FLEXIBLE BUDGET 6.1. Standard costing 6.1.1. Quantity standard 6.1.2. Price standard 6.2. Variance analysis of materials and labor 6.2.1. Direct materials variance analysis 6.2.2. Direct labor variance analysis 6.3. Using budget for performance evaluation 6.3.1. Static budget versus flexible budget 6.3.2. Performance report using a flexible budget 6.4. Variance analysis of manufacturing overhead 6.4.1. Variable overhead variance analysis 6.4.2. Fixed overhead variance analysis 10 Section 7 – PERFORMANCE EVALUATION AND DECENTRALIZATION 7.1. Decentralization and responsibility centers 7.2. Measuring the performance of investment centers by using return on investment (ROI) 7.3. Measuring the performance of investment centers by using residual income (RI) and economic value added (EVA) 6 4 8. Learning resources  Text book (Compulsory): Mowen, M.M; Hansen, D.R.; and Heitger, D.L. (2009), Cornerstones of Managerial Accounting, 3 rd edition (International student edition), South Western CENGAGE Learning. [MHH (2009)].  Lecture handouts provided by the instructor. 5 9. Weekly schedule Week Activities Reading/References Homework  Discussing about the objectives of the unit  Discussing about the grading system for the unit  Discussing about study methods and academic skills  The unit outline 1 Section 1 – INTRODUCTION TO MANAGERIAL ACCOUNTING  The meaning and objectives of managerial accounting  Comparison between managerial accounting and financial accounting  Managerial accounting and ethical conduct Section 2 – BASIC COST CONCEPTS AND CLASSIFICATIONS  The meaning and uses of cost  Production costs and non-production costs  MHH (2009) – Chapters 1 and 2  Exercises 2.30, 2.31, 2.46  Exercises 3.15, 3.16, 3.17, 3.18, 3.23, 3.24, 3.27, 3.33  Problems 3.39, 3.41, 3.42, 3.44 2 Section 2 – BASIC COST CONCEPTS AND CLASSIFICATIONS  Cost behavior  MHH (2009) – Chapters 1 and 2 3  In-class exercises – Section 2  MHH (2009) – Chapters 1 and 2 4 Section 3 – COST-VOLUME-PROFIT ANALYSIS  Break-even point in units and in sales dollars  Units and sales dollars needed to achieve a target income  Multiple-product analysis  MHH (2009) – Chapter 4  Exercises 4.19, 4.20, 4.27, 4.28, 4.29, 4.38, 4.39  Problems from 4.40 to 4.47, 4.50 6 5 Section 3 – COST-VOLUME-PROFIT ANALYSIS  CPV analysis and risk and uncertainty  The underlying assumptions and limitations of CVP analysis  In-class exercises – Section 3  MHH (2009) – Chapter 4 6  In-class exercises – Section 3 (continue) Section 4 – SHORT-RUN DECISION MAKING  Short-run decision-making model  Relevant costs and benefits, in a variety of business decisions  MHH (2009) – Chapter 13  Exercises 13.13, 13.14, 13.19, 13.24, 13.25, 13.26, 13.32, 13.33  Problems 13.39, 13.40, 13.42  Case 13.51 7 Section 4 – SHORT-RUN DECISION MAKING  The use of cost in pricing decisions  In-class exercises – Section 4  8 Section 4 – SHORT-RUN DECISION MAKING  In-class exercises – Section 4 (continue)  60-MINUTE MID-TERM TEST (Sections 1 – 4)  MHH (2009) – Chapter 13 9 Section 5 – PROFIT PLANNING  Description of budgeting  Preparing budgets  MHH (2009) – Chapter 9  Exercises from 9.21 to 9.30, 9.32, 9.34 to 9.39.  Problems 9.46, 9.47 10 Section 5 – PROFIT PLANNING  Preparing budgets (cont’d)  In-class exercises – Section 5  MHH (2009) – Chapter 9 11 Section 6 – STANDARD COSTING AND FLEXIBLE BUDGET  MHH (2009) – Chapters  Exercises from 10.27 to 10.35. 7  Standard costing  Variance analysis of materials and labor 10 and 11  Problems 10.41, 10.43.  Problems from 11.46 to 11.49, 11.55, 11.56, 11.58 12 Section 6 – STANDARD COSTING AND FLEXIBLE BUDGET  Using budget for performance evaluation  Variance analysis of manufacturing overhead  In-class exercises – Section 6  MHH (2009) – Chapters 10 and 11 13  In-class exercises – Section 6 (continue) Section 7 – PERFORMANCE EVALUATION AND DECENTRALIZATION  Decentralization and responsibility centers  MHH (2009) – Chapters 12  Exercises 12.13, 12.14, 12.15  Problems 12.34, 12.35, 12.36, 12.37 14  Measuring the performance of investment centers using ROI  Measuring the performance of investment centers using RI and EVA  In class exercise section 7  MHH (2009) – Chapters 12 15  Revision and exam preparation  MHH (2009) – All above chapters 8 10. Attendance requirement A minimum attendance of 80 percent is compulsory. Attendance records will be kept. This requirement may be waived subject to satisfying the conditions of the Student Academic Consideration Policy. General policy and information on special consideration can be found at the Office of Academic Affairs. 11. Assessment Students are expected to complete all assessment tasks for this unit. In order to pass this unit, students must (1) achieve a composite mark of at least 50% of the unit’s total marks; and (2) make a satisfactory attempt at all assessment tasks (see the table below). Failure to complete all assessment tasks will normally result in failure of the entire unit. Assessment criteria Contribution 1. Progress performance 50% (1a) Individual activities  Two 30-minute mini-tests (5% each) (test dates will be advised) 10% (1b) Group activities  Group assignment (the due date will be advised) 20% (1c) Mid-term test (60 minutes, essay format, closed book) 20% 2. Final exam (120 minutes, essay format, closed book) 50% Total 100% 12. Late submission Late assignments will receive a 10% deduction for each day they are late. Assignments more than 3 days late will not be accepted. Technological issues are not considered valid grounds for late assignment submission. This penalty for late submission may be waived subject to satisfying the conditions of the Student Academic Consideration Policy. General policy and information on special consideration can be found at the Office of Academic Affairs. 13. Plagiarism and referencing Students are responsible for submitting original work for assessment, without plagiarizing or cheating. Assignments will be rejected if they include plagiarized content or contain excessive 9 amounts of quoted/cited material and minimal original content. Students will receive a grade of zero for any assignments rejected for this reason. At University it is necessary to acknowledge the sources of information and ideas that you have incorporated in your assessment tasks. Failure to do this thoroughly may result in accusations of plagiarism. This is the academic equivalent of stealing because by not acknowledging someone else's work, you are presenting it as your own. Referencing is not only about acknowledging other people's work. Accurate referencing and lists of references are beneficial when researching a topic as they allow the reader to follow up information and read further into the area. In a sense, references provide readers with clues to help them explore different avenues of a topic. This aspect of referencing will become more valuable to you as you progress in your studies. 14. Additional information Laptop computers are not allowed to be used during lectures. All cell phones, ipads, music players and other electronic devices must be turned off or in silent mode during lectures. Lecture slides should be printed out before classes. . TO MANAGERIAL ACCOUNTING 1.1. The meaning of managerial accounting 1.2. The objectives of managerial accounting 1.3. Comparison between managerial accounting and financial accounting 1.4. Managerial. 1 UNIT OUTLINE - MANAGERIAL ACCOUNTING SEMESTER I – YEAR 2012 - 2013 1. Unit code: BBUS 1.10 2. Number of credits: 04 3. Prerequisite(s): Accounting, Principles of. ACCOUNTING  The meaning and objectives of managerial accounting  Comparison between managerial accounting and financial accounting  Managerial accounting and ethical conduct Section 2 –