Managerial accounting is associated with higher value, more predictive information. From this, data and estimates emerge. Cost accounting is the process of translating these estimates and data into knowledge that will ultimately be used to guide decision-making.
Cost Measurement and Estimation We begin by examining the differences between financial and managerial accounting. The primary difference pertains to the audience: Financial accounting information is geared toward external users, while managerial accounting is for internal users.
Managerial accounting is integral to making operational and strategic decisions.
In this unit we examine the manufacturing process and related financial accounting transactions, so you can differentiate between costs assigned to products and costs assigned to a period of time.
The flow of costs in accounting mirrors the physical flow of the inventory. For example, a pizza parlor buys the direct materials they put on their pizzas cheese, tomatoes, and pepperoni. When a customer orders a pizza, the restaurant assembles the direct materials, bakes work in process and completes a pizza finished goodsand delivers it to the customer.
Completing this unit should take you approximately 5 hours. Upon successful completion of this unit, you will be able to: Cost Management This unit focuses on three categories of cost management: For a company that produces items for a job order, it is easy to identify the direct materials and direct labor needed to complete a specific job.
However, how do you determine direct materials if the company uses a continuous assembly line? It would be inefficient to track each unit of production separately. In this unit we also address how to allocate manufacturing overhead.
Manufacturing overhead consists of costs not directly related to the product, but necessary to run the production process. This includes, but is not limited to, factory equipment, factory rent, and utilities for the factory. Completing this unit should take you approximately 19 hours.
Short-Term Decision Making This unit introduces a new way to evaluate costs and make management decisions. Rather than examining direct materials, direct labor, and manufacturing overhead, we rearrange this information as variable costs, fixed costs, and mixed costs fixed and variable costs combined.
For example, in the previous unit we classified a factory worker who earns a salary and annual bonus based on company performance as direct labor.
In this unit, we allocate salary to fixed costs, and the bonus to variable costs. We also explore how managers make short-term decisions what needs to occur during the next hour, day, week, or year.
Fixed cost restraints, such as plant size, equipment size, and age, often define short-term decisions. Understanding how these three types of costs variables behave allows business managers to predict revenue, operating income, and changes in sales volume. Completing this unit should take you approximately 6 hours.
Cost-Volume-Profit Analysis In this unit we explore the relationships that revolve around costs, volume, and profit CVPand how companies plan for profitability. For example, a chief executive officer of a company that manufactures snowboards should know how many boards they need to produce to cover their costs and earn a decent profit by end the month.
Breakeven analysis is synonymous with CVP analysis and identifies how changes in key variables impact financial projections and profitability. Completing this unit should take you approximately 3 hours. Differential Analysis In this unit we examine how manufacturers decide whether to outsource elements of their operation, a decision process that requires making a differential analysis to determine the revenues and costs for alternative courses of action.
As you work through this unit, notice you will use the contribution margin income statement format. We will examine a relatively simple and more complex examples to establish the format used to perform differential analysis.
Completing this unit should take you approximately 4 hours. Budgeting In this unit we explore the components for preparing a master budget and its underlying performance schedules. Business managers create budgets to plan for future operations, create benchmarks to measure progress, and maintain necessary accounting controls.
The budget process involves coordination among every department that is part of the company. Once the master budget is complete, the company can measure how actual performance compares with the budget.
Variance Analysis In this unit, we examine how managers analyze their budgets and actual results to make better decisions. We will explore various methods for rationalizing the master budget for actual results. When actual sales volume is higher than what was planned in the master budget, variable costs should also be higher.
In another thread, we watch Tony Bell consider various "problems" that explain variance, and how to use accounting for variance to improve ongoing management decisions.An introduction to the basic concepts needed to select and use accounting information necessary for managerial decision making.
Students learn how managers plan for the operations of their business, assess how effectively their plans are being implemented, control operations, and use accounting data to make internal decisions.
Offered: Fall, Spring. Managerial accounting is integral to making operational and strategic decisions. In this unit we examine the manufacturing process and related financial accounting transactions, so you can differentiate between costs assigned to products and costs assigned to a period of time.
Course Overview and Introduction to Managerial Accounting In this module, you will become familiar with the course, your instructor, your classmates, and our learning environment.
Then, you will be introduced to Managerial Accounting and Costing ph-vs.com Info: Course 1 of 7 in the Value Chain Management Specialization. Accounting Intro to Managerial Accounting has been evaluated and recommended for 3 semester hours and may be transferred to over 2, Course Ratings are calculated from individual students’ ratings and a variety of other signals, like age of rating and reliability, to ensure that they reflect course quality fairly and accurately.
Managerial accountants compute and provide information within a company. Managerial accounting information is numeric, calculated using certain formulas. The following list summarizes some of the most important formulas in managerial accounting.
A basic rule of accounting is that the accounting.