Course Title:  Advanced Management Accounting

Course Code:

    ACT-406

Prerequisite Course: Management Accounting

 Credit:   3.0

Total Marks: 100

Contact Hour: 3 hours per week

Rationale: This course is designed to provide the students an in-depth knowledge of Management Accounting to enable them to apply its methods and techniques for preparing and presenting information for management decision-making and control purposes. Formulation of  strategic plan for achieving efficiency and effectiveness in business operation is also the focus of this course.

Objectives:

1.      To apply management accounting techniques in Planning, control and decision making situations;

2.      To illustrate and evaluate absorption and segment reporting and decentralization;

3.      To apply and evaluate techniques for allocating and managing resources.

4.      To discuss and demonstrate a range of performance analysis and profitability analysis;

5.      To prepare and evaluate plans, budgets and forecasts.

Learning Outcomes

Course Content

Teaching/Learning Strategy

Assessment Strategy

1. Able to define Budget, Forecast and Budgeting.

2. Able to identify Types of Budgets and their Interrelationship.

3. Able to understand and prepare Functional Budgets, Cash Budget, Master Budget, Budgeted Income Statement, Budgeted Balance Sheet, Flexible Budget and Static Budget.

4. Able to understand the Role of Budgeting in Service and Not-for-Profit Organizations; Zero-Base Budget; Behavioral Aspects of Budgeting. 

Budget, Forecast and Budgeting; Budgeting process; Types of Budgets and their Interrelationship; Preparation of Functional Budgets; Cash Budget; Master Budget; Budgeted Income Statement; Budgeted Balance Sheet; Flexible Budget; Static Budget; Role of Budgeting in Service and Not-for-Profit Organizations; Zero-Base Budget; Behavioral Aspects of Budgeting. 

Lecture, Discussion, Problem based Exercise

Assignment, Quiz, Question & Answer

1. Able to define Cost, Profit and Investment Centers.

2. Able to understand Marketing Cost and Profitability Analysis, Return on Investment, Operating Income, Operating Asset, Residual Income, Common and Traceable Fixed Cost.

3. Able to identify different Classes of Marketing Cost and their Cost Allocation Base

4. Able to understand Contribution Margin Approach. 

Cost, Profit and Investment Centers, Marketing Cost and Profitability Analysis, Return on Investment, Operating Income, Operating Asset, Residual Income, Common and Traceable Fixed Cost, Classification of Marketing Cost and their Cost Allocation Base, Contribution Margin Approach. 

Lecture, Discussion,

Question & Answer

1. Able to analyze different Profit-Related Variances

2. Able to define and understand Profitability of Segments.

3. Able to explain Product Line, Divisional Profit; Customer Profitability, Overall profit.

4. Able to realize profitability in short and long term basis.

Analysis of Profit-Related Variances: Contribution Margin Variance, Market Share and Market Size Variances; Profitability of Segments: Profit by Product Line, Divisional Profit; Customer Profitability, Overall profit; Time and Profit: Short-Run Profitability and Long-Run Profitability.

Lecture, Discussion, Problem based Exercise

Assignment, Quiz, Question & Answer

1. Able to Measure total business unit performance under different perspective

2. Able to explain Meaning and benefits of benchmarking analysis, Types of benchmarking, Benchmarking process, TQM and benchmarking , Management Accounting for benchmarking

3. Able to realize Environmental Management  Accounting (EMA), Six Sigma.

Measuring total business unit performance- The BSC-Financial perspective- Customer perspective- Internal business process perspective- Learning and growth perspective, Four perspective and their sufficiency. Meaning and benefits of benchmarking analysis, Types of benchmarking, Benchmarking process, TQM and benchmarking , Management Accounting for benchmarking, Environmental Management  Accounting (EMA), Six Sigma.

Lecture, Discussion,

Question & Answer

1. Able to explain Transfer price, Objectives of transfer price, Transfer pricing methods

2. Able to understand

Choosing the right transfer pricing method, Transfer price for service departments, Multinational transfer pricing, Behavioral implications of transfer pricing.

Transfer price, Objectives of transfer price, Transfer pricing methods: Cost-based transfer prices, Market-based transfer prices, Negotiated transfer prices, Dual transfer pricing, Choosing the right transfer pricing method, Transfer price for service departments, Multinational transfer pricing, Behavioral implications of transfer pricing.

Lecture, Discussion, Problem based Exercise

Assignment, Quiz, Question & Answer

1. Able to describe Customer Demand, Price Elasticity of Demand, Market Structure and Price.

2. Able to understand Establishing Optional Price and Output, various cost plus pricing methods

Customer Demand, Price Elasticity of Demand, Market Structure and Price. Establishing Optional Price and Output; Cost-Plus Pricing Methods: Variable Cost Pricing, Differential Cost Pricing, Full Cost Pricing, Conversion Cost Pricing and Direct Cost Pricing; ABC and Pricing.

Lecture, Discussion, Problem based Exercise

Assignment, Question & Answer

Recommended Books and Materials

Text Book:

1.      Garrison R.H. and Noreen E.W. “Managerial According.” (Latest Edition) Mc Graw-Hill Irwin.

References:

1.      Kaplan R.S, and Atkinson A.A “Advanced Management Accounting, (Latest Edition), Prentice-Hall of India, New Delhi- 110001.

2.      Horngren C.T. and Sundem G.L. “Introduction to Management Accounting,” (Latest Edition), Prentice-Hall of India, New Delhi.