This module aims to equip students with the knowledge, understanding and skills required to carry out basic accounting and financial analysis and to communicate effectively with accountants.
Introduction to management accounting: Cost classifications and cost behaviour. Direct and indirect costs. Assigning direct costs. Blanket overhead costs. Two stage allocation process for indirect costs.
Definition of process costing: Joint products and by-products. Process costing when all output is fully completed, losses in process.
Activity Based Costing: The problem with traditional absorption costing. The advantages and disadvantages of Activity Based Costing. ABC cost allocation process.
The budgeting process: Budgeting road map. Sales, production, direct labour, materials and overhead budgets. Departmental budgets. Cash budgets. Flexed budgets. Material, price and usage variances.
Capital investment decisions: The time value of money, compounding and discounting. Net present value. Internal rate of return. Payback method. Accounting rate of return.
