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23 views

Paper_1_-_Cost___Management_Accounting_2

Uploaded by

Prisha Rungta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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St.

Xavier’s College (Autonomous), Kolkata


Postgraduate and Research Department of Commerce

Semester III
Course name: COST AND MANAGEMENT ACCOUNTING - 2
Course code: C2BC230311T
Course Credits: 4
Pedagogy: Classrooms lecture & Seminar.
Course Description: The course aims to enable the learners in understanding, develop, and apply
the tools and techniques of cost and management accounting in financial decision-making with
respect to business entities. It seeks to develop students’ competence toward cost ascertainment,
planning, and control, and managerial decision making.
Learning Objectives:
The course aims to help learners to acquire conceptual knowledge of;
LO1. To understand Process Costing, Joint Products, and By-Products.
LO2. To develop an understanding of marginal costing and CVP analysis and its applications in short
term decision making.
LO3. To understand the process of preparing different types of budget.
LO4. To compute and analyse variances related to material, labour, overhead and revenue.
Course Outcomes:
On successful completion of the course, students will be able to:
CO1. Elucidate the meaning, objectives, nature, and scope of Process costing and the concept of
Joint product and By-product.
CO2. Understand the meaning of marginal costing along with its components, and difference
between Absorption Costing and Variable Costing.
CO3. Execute a Cost-volume-profit analysis and a Break-even analysis, compute Profit/Volume
Ratio, Angle of Incidence, margin of safety, Key factor(s) and be able to determine cost indifference
point.
CO4. Clearly understand the concept of relevant information and the use of such information for
various short-term decision-making situations, including operational decisions.
CO5. Draw up Production Budget, Cash Budget, Fixed and Flexible Budget, Sales Budget and clearly
understand Zero-Based Budgets.
CO6. Understand the concept of standard costs and be able to execute Variance Analysis with
respect to material, labour, and overhead.
Unit Unit Name Topics Nos. of
No. lectures
1 Process Costing, Process cost recording, Process loss, Abnormal gains and 14
Joint Products, and losses, Inter-process profit, Equivalent units of production,
By-Products Valuation of work in process.
Introduction to Joint Products and By-Products.
2 Marginal Costing Basic concepts of marginal costing, Determination of cost 20
and Cost Volume- of a product under marginal costing method,
Profit Analysis determination of cost of finished goods, Comparison of
Marginal costing with absorption costing method -
Reconciliation of profit under Marginal costing and
Absorption costing methods.
Cost-Volume-Profit (CVP) Analysis: CVP assumptions and
uses; Break-even Analysis: Break-Even Point and Margin of
Safety; Contribution margin, Break-even, and profit

Page 1 of 2
St. Xavier’s College (Autonomous), Kolkata
Postgraduate and Research Department of Commerce

volume charts, Contribution to sales ratio, Angle of


Incidence, Multi-product break-even analysis.
Consideration of Limiting factor (key factor), Cost
Indifference Point.
3 Application of Steps in the decision-making process, Concept of Relevant 22
Marginal Costing costs and benefits, Various short-term decision-making
techniques to relating to:
Decision Making i. Profitable Product-mix,
ii. Acceptance or Rejection of special/export offers,
iii. Make or buy, Addition or Elimination of a product line,
and
iv. Operate or shut down.
4 Budgetary Control Meaning of Budget, Essentials of Budget, Budget Manual, 10
Principal or Key budget factors, Preparation of Budget and
monitoring procedures. The use of budget in planning and
control.
Preparation of Functional budget for operating and non-
operating functions, Cash budget, Flexible budget, Zero
Based Budgeting (ZBB).
5 Standard Costing Setting up of Standards, Types of Standards, Standard 12
Costing as the method of performance measurement,
Standard Costing, and Budgetary Control – difference.
Calculation of Cost Variances - Material Cost Variance,
Employee Cost Variance, Variable Overhead Variance, and
Fixed Overhead Variance.

SUGGESTED TEXT BOOKS/ READING MATERIALS:


▪ Dr. M. Hanif – “Modern Cost and Management Accounting”, McGraw-Hill Education
Pvt. Ltd.
▪ Saxena and Vashist – “Cost and Management Accounting (Text)”, Sultan Chand and
Sons.
▪ Dr. B. Banerjee – “Cost Accounting”, Prentice Hall, India.
▪ Ashis Bhattacharya – “Cost Accounting”, Prentice Hall, India.
▪ Basu and Das – “Cost and Management Accounting”, Rabindra Library, Kolkata
▪ Mowen, M. M., & Hansen, D. R. - Cost Management. Stanford: Thomson

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