Management Accounting-1 (MA)

Syllabus

Course Objectives

 Understand the roles and differences of financial, cost, and management accounting, and
apply data analysis techniques for decision-making.

 Comprehend cost concepts and classifications, and understand production and non-
production costs.

 Learn accounting for material, labour, and overhead costs, and apply valuation methods and
cost allocations.
 Apply various costing methods and understand alternative cost accounting techniques.

Course Outcomes

 Differentiate between financial, cost, and management accounting, and use data analysis for
financial decisions.
 Classify and analyse production and non-production costs for managerial planning.
 Demonstrate proficiency in accounting for material, labour, and overhead costs.
 Apply costing methods and advanced cost accounting techniques effectively.

UNIT-1

Introduction to financial management and Data analysis and statistical techniques

Purpose and role of cost and management accounting, difference between financial accounting with
cost and management accounting, the managerial processes of planning, decision-making and
control, difference between strategic, tactical and operational planning, distinguish between data
and information- attributes of good information, limitations of management information.
Introduction to data -machine/sensor, transactional and human/social, sources of information
(including government statistics, financial press, professional or trade associations, quotations and
price lists) uses and limitations of published information/data, Data analysis and statistical
techniques- Sampling methods- Forecasting techniques- Summarising and analysing data-
Spreadsheets.

UNIT-2

Cost classification and Methods of costing

Concept of cost – cost classification based on nature of expenses, function -illustrate

production and non-production costs, different elements of non-production costs - administrative,
selling, distribution and finance- elements of production costs - materials, labour and overheads - e
importance of the distinction between production and non-production costs - illustrate with
examples classifications used in the analysis of product/service costs - cost behaviour with use of
graphs – concept of cost objects, cost units & cost centres- between between cost, profit,
investment and revenue centres, g needs for information of cost, profit, investment and revenue
centre managers.

UNIT-3

Accounting for costs – Material, labour & Overheads

Accounting for material costs – ordering, receiving & issuing material – methods of valuing
purchases and issues (FIFO & Weighted Average methods only) – EOQ – inventory levels –
Accounting for labour – direct & indirect cost of labour – remuneration methods (individual
& group) – labour turnover – overtime & idle time – labour efficiency, capacity & volume
ratios. Accounting for overheads – allocation of overheads to production & nonproduction
departments – apportion service overheads to production departments - production
overhead absorption rates – entries for accounting of material, labour & overhead costs.

UNIT-4

Methods of costing & Alternative cost accounting

Understanding of applying job & batch costing, Process costing (including joint products &
by-products, equivalent production), service costing – understand the differences between
absorption & marginal costing- activity-based costing (ABC), target costing, life-cycle costing and
total quality management (TQM).
Management Accounting-II (MA/FMA)

Syllabus

Course Objectives

 Understand budgeting processes, including preparation, stages, and the use of various types
of budgets (sales, functional, cash, master) along with the concepts of 'what if' analysis and
scenario planning.
 Learn the concepts and applications of flexible budgets, capital budgeting, and discounted
cash flows, including NPV and IRR calculations, and understand their role in financial
planning and control.
 Develop skills in budgetary control, variance analysis, and responsibility accounting, and
prepare control reports with actionable recommendations for management.
 Gain knowledge in standard costing, variance calculations, and performance measurement,
and learn to monitor and report organizational performance effectively.

Course Outcomes

 Students will be able to prepare various types of budgets and perform 'what if' analysis for
effective financial planning.
 Students will be able to apply flexible budgeting, capital budgeting, and discounted cash flow
techniques to assess investment viability.
 Students will demonstrate proficiency in variance analysis, responsibility accounting, and
preparing management control reports.
 Students will be able to calculate variances, apply standard costing principles, and measure
and report organizational performance.

Unit-1

Budgeting

Understand the use of budgets- administrative procedures used in the budgeting process- stages
in the budgeting- (including sources of relevant data, planning and agreeing draft budgets and
purpose of forecasts and how they link to budgeting) - Budget preparation- importance of the
principal budget factor- Prepare sales budgets (problems)- Prepare functional budgets (production,
raw materials usage and purchases, labour, variable and fixed overheads)- problems on cash
budgets- master budgets (statement of profit or loss and statement of financial position)-cocept of
‘what if’ analysis and scenario planning.

Unit-2

Flexible budgets, Capital budgeting and discounted cash flows

Concept of flexible budgets in control, disadvantages of fixed budgets in control- situations where
fixed or flexible budgetary control would be appropriate- Flex a budget to a given level of volume-
concept of capital budgeting- importance of capital investment planning and control- Definition and
distinguish between asset and expense items- steps involved in the preparation of a capital
expenditure budget- difference between simple and compound interest, and between nominal and
effective interest rates(problems)- compounding and discounting (problems)- net present value
(NPV) and internal rate of return (IRR) methods of discounted cash flow- Calculation on present
value using annuity and perpetuity formulae- Calculate NPV, IRR and payback (discounted and non-
discounted)- Interpret the results of NPV, IRR and payback calculations of investment viability.

Unit-3

Budgetary control and reporting

Calculation of simple variances between flexed budgets, fixed budget and actual sales, costs and
profits-relative significance of variances- concept of responsibility accounting and its significance in
control- concept of controllable and uncontrollable costs- Prepare control reports suitable for
presentation to management (to include recommendation of appropriate control action)- .
Behavioural aspects of budgeting.

Unit-4

Standard costing and Performance measurement

Concept of standard costing purpose and principles, difference between standard, marginal and
absorption costing- Variance calculations and analysis- Calculate sales price and volume variance-
Calculate materials total, price and usage variance- Calculate labour total, rate and efficiency
variance- Calculate variable overhead total, expenditure and efficiency variance- Calculate fixed
overhead total, expenditure and, where appropriate, volume, capacity and efficiency variance-
concept of Performance measurement- Performance measurement – application- Monitoring
performance and reporting.