Robert N. Holt, Ph.D., CPA
Introduction to Managerial Accounting
Job Order and Process Costing
Variances and Activity Based Costing
Audience: Anyone needing a fundamental understanding of managerial accounting and the role of the managerial accountant.
Abstract: A working knowledge of managerial accounting is critical to success in business. Although some individuals may not be aware of job order costing, variances and activity based costing, they are exposed to budgeting and in some cases, capital budgeting. This course is a good overview of all these topics.
Chapter 1 introduces the role of the management accountant, cost behavior such as fixed costs, variable costs, semifixed, etc. Also, the contrast between manufacturing companies and merchandising companies is explored.
Chapter 2 deals with job order costing and process costing. Direct materials, direct labor and overhead are introduced along with under and over application of overhead. Process costing is explained with particular emphasis on the equivalent unit.
Chapter 3 covers fixed and variable costs, breakeven and contribution margin. The concepts of variable costing and absorption costing are explained.
Chapter 4 discusses budgeting-the static budget and a flexible budget. The entire manufacturing budget scenario is described starting with the sales budget, the production budget, the manufacturing overhead budget, the cost of goods sold budget, and finally the budgeted income statement and balance sheet.
Chapter 5 covers variances and introduces the topic of activity based costing (ABC). Standards for materials, labor, and overhead are discussed along with the associated variances. A simplistic example of ABC is given and contrasted with a base application of overhead.
Chapter 6 introduces the concept of present value followed by the steps in the capital budgeting process. Differential analysis is emphasized as well as discounted cash flow techniques such as net present value and the internal rate of return.