UNIVERSITY OF TECHNOLOGY, JAMAICA

SYLLABUS OUTLINE

COLLEGE : Business and Management

SCHOOL : Business Administration
COURSE OF STUDY : Bachelor of Business Administration
Bachelor of Science in Economics
Bachelor of Science in Child & Adolescent Development
Bachelor of Science in Actuarial Science
LEVEL : Two (2)
MODULE TITLE : Introduction to Management Accounting
MODULE CODE : ACC2008
DURATION (Hours) : 45 hours
CREDIT VALUE : Three (3) credits
PREREQUISITES : None

1.0 MODULE DESCRIPTION

The objective of this module is to provide an understanding of accounting as an aid to

decision making, controlling, planning and monitoring. The module introduces students
to management accounting principles which are used to make and support decisions.
Emphasis will be placed on developing a structured approach to cost and revenue
analysis, problem solving and the preparation of management reports.

2.0 GENERAL OBJECTIVES

Upon the completion of this module, students should:
2.1 understand how information is used to assist managers in making decisions.
2.2 know the different methods of classifying costs to meet the diverse information
needs of stakeholders in an organization.
2.3 understand the importance of budget preparation and its effect on the overall
operation of the organization and in performance evaluation.
2.4 evaluate the information required for making short-term decisions based on
resource constraints, idle capacity and organizational expertise
2.5 analyze actual costs with standard costs and analyze any variances

3.0 MODULE OBJECTIVES/LEARNING OUTCOMES

Unit 1 – Introduction to Cost and Management Accounting (3 hours)

Specific Objectives
Upon the completion of this module, students should be able to:
3.1.1 distinguish data from information.
3.1.2 explain the attributes of good information.
3.1.3 outline the managerial processes of planning, decision making and control.

Introduction to Management Accounting (ACC2008) Syllabus – July 2015 1

 3.1.4 describe the purpose and role of cost and management accounting within
organization’s management information system.
3.1.5 compare and contrast financial accounting and managerial accounting
3.1.6 explain the limitations of management information in providing guidance for
managerial decision making

Module content and context

 Accounting for management
 Management accounting versus financial accounting
 Qualitative characteristics of good information

Unit 2 – Cost Classification ( 3 hours)

Specific Objectives
Upon the completion of this module, students should be able to:
3.2.1 define cost.
3.2.2 define the concepts ‘cost object’ and ‘cost unit’.
3.2.3 explain classifications used in the analysis of product/service costs, including by
function, timing and charges against sales, traceability, behaviour, and relevance
to planning, controlling and decision making.
3.2.4 distinguish between production cost and non-production cost when valuing output
and inventories.
3.2.5 select the appropriate classification for a given cost or a group of costs.
3.2.6 provide examples of the different classifications of cost.
3.2.7 illustrate through the use of charts the classification of product/service costs.
3.2.8 compute total cost based on particular classification from a list of cost.
3.2.9 calculate conversion costs and prime costs.
3.2.10 Explain the concepts of controllable and uncontrollable costs.

Module content and context

 Management functions
 Timing and charges against sales
 Traceability
 Relevance to planning, controlling and decision making
 Behaviour

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 Unit 3 – Cost Behaviour and Cost Estimation (6 hours)
Specific Objectives
Upon the completion of this module, students should be able to:
3.3.1 describe linear cost behaviour.
3.3.2 identify the behaviour of cost on a total basis and on a per unit basis.
3.3.3 illustrate graphically the different types of cost behaviour on a per unit basis and
on a total basis.
3.3.4 provide examples of cost which falls within the categories of fixed, variable,
semi-variable and step.
3.3.5 identify non-linear cost behaviour.
3.3.6 graphically represent non-linear cost behaviour.
3.3.7 choose cost behaviour patterns which relate to real world situations.
3.3.8 identify the five methods for estimating cost.
3.3.9 explain the advantages and disadvantages of the five methods of cost estimation.
3.3.10 choose the cost estimation method which is most advantageous for a given
situation.
3.3.11 estimate variable cost, fixed cost and total cost using the high-low method.
3.3.12 compute a cost function using regression analysis.
3.3.13 calculate the coefficient of determination test of reliability.
3.3.14 interpret the coefficient of determination.
3.3.15 evaluate methods for the analysis of costs into fixed and variable components.

Module content and context

 Cost Behaviour
- Linear cost behaviour
- Non-linear cost behaviour
 Cost Estimation
- High-Low method
- Scattered Graph method
- Regression or least square method
- Account analysis
- Engineering analysis

Unit 4 – Budgeting (9 hours)

Specific Objectives
Upon the completion of this module, students should be able to:
3.4.1 explain why organizations use budgeting.
3.4.2 explain the administrative procedures used in the budgeting process.
3.4.3 describe the stages in the budgeting process.
3.4.4 explain the following types of budgets: zero-based, activity-based, incremental,
master, and flexible.
3.4.5 identify the major components of the master budget.

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 3.4.5 prepare the master budget (operating and financial budgets) for manufacturing
and non-manufacturing entities.
3.4.6 explain the relevance of cash budgeting as a planning tool to aid in the
coordination of business activities.
3.4.7 explain the importance of flexible budget
3.4.8 explain the advantages and disadvantages of budgeting
3.4.9 flex a budget to a given level of volume
3.4.10 calculate simple variance between flexed budget, fixed budget and actual
3.4.11 apply the concept of budgeting to our lives.
Module content and context
 Nature and purpose of budgeting
 Types of budget
- Zero-based budget (Theory only)
- Activity-based budget (Theory only)
- Incremental budget (Theory only)
- Master budget

Unit 5 – Cost Volume Profit Analysis ( 6 hours)

Specific Objectives
Upon the completion of this module, students should be able to:
3.5.1 explain the nature of CVP analysis.
3.5.2 identify assumptions of CVP analysis.
3.5.3 state the uses of CVP analysis in terms of planning and decision-making
situations.
3.5.4 calculate contribution margin ratio and variable cost ratio.
3.5.5 calculate the breakeven point for a single product and for more than one product.
3.5.6 compute safety margin for a single product and for more than one product.
3.5.7 explain an entity’s safety margin.
3.5.8 calculate budgeted sales volume required for a given target net income.
3.5.9 explain how cost-volume-profit aids in decision making.
3.5.10 illustrate with the aid of breakeven charts the break-even point.
3.5.11 present their findings orally, relating to a cost volume profit analysis.

Module content and context

 Single product analysis and multi-product analysis
- Uses
- Assumptions
- Breakeven point
- Margin of safety
- Target profit before taxes and after taxes
- Sales mix
- Ratios
- Breakeven charts

Introduction to Management Accounting (ACC2008) Syllabus – July 2015 4

 Unit 6 – Marginal Costing and Decision Making (6 hours)

Specific Objectives
Upon the completion of this module, students should be able to:
3.6.1 explain the concept of relevant cost
3.6.2 distinguish between relevant and irrelevant information using appropriate criteria.
3.6.3 explain the use of incremental and opportunity costs in decision-making.
3.6.4 apply relevant costing principles to make or buy sourcing decisions, special order
decisions.
3.6.5 specify the qualitative factors which are relevant to make or buy decisions, special
order decisions.
3.6.6 calculate solutions to problems involving changes in product mix, and/or
discontinued products or departments.
3.6.7 identify limiting factors in a scarce situation
3.6.7 illustrate the impact of limiting factors on the decision making process.
3.6.8 determine the optimal production plan where an organisation is restricted by a
single limiting factor.

Module content and context

 Special order
 Make or buy
 Limiting factor
 Discontinuation of product line or department

Unit 7 - Standard Costing and Variance Analysis ( 6 hours)

Specific Objectives
Upon the completion of this module, students should be able to:
3.7.1 define standard cost
3.7.2 explain the purpose and principles of standard costing
3.7.3 outline the uses, features and limitations of standard costing.
3.7.4 explain how standards are developed.
3.7.5 calculate variances for materials, labour and variable overheads variances.
3.7.6 interpret the causes of variances, their inter-relationship with each other and their
relevance to management.
Module content and context
 Standard costing purpose and principles
 Variance analysis
- Material
- Labor
- Variable overhead

Introduction to Management Accounting (ACC2008) Syllabus – July 2015 5

4.0 LEARNING AND TEACHING APPROACHES

Unit Content Teaching/Learning Strategy

Introduction to Cost and
1 Management Accounting
2 Cost Classification
Cost Behavior and Cost
3 Estimation
4 Budgeting
5 Cost Volume Profit Analysis
Marginal Costing and Decision
6 Making
Standard Costing and Variance
7 Analysis
lecture, think-pair-share, discussion, You Tube
presentation
lecture, peer tutoring, problem solving, game
lecture, presentations, problem solving, Case study
presentation, You Tube presentation
lecture, Quiz, problem solving
lecture, Case study presentations, problem solving
lecture, Quiz, peer discussion, peer tutoring, You tube
presentation
lecture, Quiz, problem solving

5.0 BREAKDOWN OF HOURS

Lecture 13 hours
Tutorial 26 hours
Assessment 6 hours

6.0 TEXTBOOKS AND REFERENCES

Required Text:
Drury, C. (2014). Management and cost accounting (9th ed.). London, UK: Cengage
Learning EMEA.

Recommended Text:
Horngren, C.T., Sundem, G.L., Stratton,W.O., Burgstahler, D., & Schatzberg, J. (2012).
Introduction to management accounting (16th ed.). Boston, Massachesetts:
Prentice Hall

Additional Reading:
ACCA paper F2: Management accounting. (2015). London, UK: BPP Learning Media.
ACCA paper F5: Performance management (2015). London, UK: BPP Learning Media.
ACCA Global. (n.d.). Exam Resources. Retrieved from:
http://www.accaglobal.com/an/en/student/exam-support-resources.html

Module information can be found on UTech Online: “Introduction to Management

Accounting”

Moodle password: ACC2008

Introduction to Management Accounting (ACC2008) Syllabus – July 2015 6

8.0 SYLLABUS DEVELOPER(S) & REVIEWER(S)
Errol Brandford

Deonette McInnis-Lambert (1st Revision – 2010)

Carlinton Montgomery (2nd Revision -2012)

James McNish, Mark Jackson and Roger Brown (3rd Revision- July 2014)

James McNish, Deonette McInnis-Lambert, Mark Jackson, Kerwin Hamil (4th Revision-
July 6, 2015)

*Objectives from the cognitive domain and the module context were mirrored from
ACCA F2 – Management Accounting

9.0 APPROVAL

Programme Director (PD): Deonette McInnis-Lambert Signature _____________

College Curriculum Committee: Celia McKoy Signature______________

10.0 ACCEPTANCE BY OFFICE OF CURRICULUM DEVELOPMENT &

EVALUATION (OCDE)

Officer________________________________ Date: ____________________

Introduction to Management Accounting (ACC2008) Syllabus – July 2015 7