Description:

Covers the fundamentals and principles of cost accounting. Students learn cost control by applying process, job, and standard cost procedures. Prerequisite: ACCT 102 or permission of instructor.

Outcomes:

After completing this class, students should be able to:

• Introduction to Cost Accounting.
• Explain the uses of cost accounting data.
• Describe the ethical responsibilities and certification requirements for management accountants.
• Describe the relationship of cost accounting to financial and managerial accounting.
• Identify the three basic elements of manufacturing costs.
• Illustrate basic cost accounting procedures.
• Distinguish between the two basic types of cost accounting systems.
• Illustrate a job order cost system.
• Accounting for Materials.
• Recognize the two basic aspects of materials control.
• Specify internal control procedures for materials.
• Account for materials and relate materials accounting to the general ledger.
• Account for inventories in a just-in-time system.
• Account for scrap materials, spoiled goods, and defective work.
• Accounting for Labor.
• Distinguish between features of hourly, rate and piece-rate plans.
• Specify procedures for controlling labor costs.
• Account for labor costs and payroll taxes.
• Prepare accruals for payroll earnings and taxes.
• Account for special problems in labor costing.
• Accounting for Factory Overhead.
• Identify cost behavior patterns.
• Separate semivariable costs into variable and fixed components.
• Prepare a budget for factory overhead costs.
• Account for actual factory overhead costs.
• Distribute service department factory overhead costs to production departments.
• Apply factory overhead using predetermined rates.
• Account for actual and applied factory overhead.
• Process Cost Accounting: General Procedures.
• Recognize the differences between job order and process cost accounting sys-tems.
• Compute unit costs in a process cost system.
• Assign costs to inventories, using equivalent units of production with the average cost method.
• Prepare a cost of production summary and journal entries for one department with no beginning inventory.
• Prepare a cost of production summary and journal entries for one department with beginning inventory.
• Prepare a cost of production summary and journal entries for multiple depart-ments with no beginning inventory.
• Prepare a cost of production summary and journal entries for multiple depart-ments with beginning inventory.
• Prepare a cost of production summary with a change in the prior department's unit transfer cost.
• The Master Budget and Flexible Budgeting.
• Explain the general principles involved in the budgeting process.
• Identify and prepare the components of the master budget.
• Identify and prepare components of the flexible budget.
• Explain the procedures to determine standard amounts of factory overhead at different levels of production. Standard Cost Accounting: Materials, Labor, and Factory Overhead.
• Describe the different standards used in determining standard costs.
• Use the proper procedures for recording standard costs for materials and labor.
• Explain the meaning of variances and how they are analyzed.
• Prepare journal entries to record and dispose of variances.
• Perform an in-depth variance analysis.
• Recognize the specific features of a standard cost system.
• Account for standard costs in a departmentalized factory.
• Recognize the difference between actual and applied overhead.
• Compute the controllable variance and the volume variance for the two-variance method of analysis.
• Compute the spending, efficiency, budget, and volume variances for the four-variance method of analysis.
• Compute the budget, capacity, and efficiency variances for the three-variance method of analysis.
• Cost Analysis for Management Decision Making.
• Compute net income under the variable costing and absorption costing methods.
• Discuss the merits and limitations of variable costing.
• Define the concept of segment profitability analysis and explain the distinction between direct and indirect costs.
• Compute the break-even point and the target volume needed to earn a certain profit for both single- and multi-product firms.
• Calculate the contribution margin ratio and the margin of safety ratio.
• Discuss the impact of income tax on break-even and target-volume computa-tions.
• Use differential analysis techniques to make special decisions.
• Identify the appropriate techniques to analyze and control the distribution costs incurred in selling and delivering products.