UBMSFSII.5 : INTRODUCTION TO COST ACCOUNTING
[50 lectures: 3 Credit]
Objectives of the Course:
- To enable the students to understand the principles and procedure of cost accounting and to apply them to different practical situations.
- The primary objective of the course is to familiarize the students with the basic cost concepts, allocation and control of various costs and methods of costing.
| Units | Name of the topic | No. of | |
| lectures | |||
| Unit I | Introduction to Cost Accounting: | 10 | |
| a) Meaning, Nature and scope | |||
| b) Objective of Cost Accounting | |||
| c) Financial Accounting v/s Cost Accounting | |||
| d) Advantages and disadvantages of Cost Accounting | |||
| e) Cost classification (concept only) | |||
| f) Types of costing- Job, process, batch and contract | |||
| (concept only) | |||
| g) Installation of Cost Accounting System. | |||
| Unit II | Elements of Cost: | 20 | |
| a) Material- Introduction, motives of holding stock, stock | |||
| valuation (FIFO & weighted average method), maintenance of | |||
| stock levels. | |||
| b) Labour- Introduction, labour remuneration | |||
| (Time rate & Price rate), labour turnover | |||
| c) Overheads- Introduction, classification of overheads, | |||
| Distribution/Appointment of overheads | |||
| d) Introduction to concept of absorption costing- | Under | ||
| absorption/over absorption of overheads (concept only) | |||
| e) Determination of total cost/ composition of selling price/ | |||
| cost sheets /translation, valuation of closing stock | |||
| /Estimated/Tender/Offer (Basic numericals) | |||
| Unit III | Reconciliation between Cost and Financial records: | 10 | |
| Meaning and Definition, Need for Reconciliation, causes of | |||
| disagreement, procedure and preparation of Statement of | |||
| Reconciliation. | |||
| Unit IV | Elementary principles and techniques of Marginal Costing | 10 | |
| 1)Elementary principles of Marginal Costing- Meaning, features of | |||
| Marginal Costing, Advantages of Marginal Costing, Limitations of | |||
Marginal Costing and Concept of Profit.
- Techniques of Marginal Costing – Contribution, Profit-volume Ratio, Breakeven point, Margin of Safety, Cost-volume-profit Analysis.
- Basic problems on managerial decision making (Buy or Sell)
- Budgetary Control: Basic: Budget, Purchase and Sell Budget.
Reference Books:
- Management Accounting I.M. Pandey Vikas Publishing
- Cost Accounting C.S. Rayudu Tata McGraw Hill and Co. Ltd, Mumbai
- Cost Accounting Theory and Practice M.N. Aurora S. Chand & Co. (P) Ltd., New Delhi
- Cost Accounting A Managerial Emphasis Horngren, Charles, Foster and Datar, Prentice Hall of India
- Advanced Problems and Solutions in Cost Accounting, Maheshwari S.N., S.Chand and Co.
(P) Ltd., New Delhi
- Cost Accounting Jain S.P., Narange K.L. Kalyani, New Delhi
- Cost Accounting and Financial Management Ravi M. Kishore Taxman’s
- Principles of Cost Accounting Vanderbeck Thomson learning
- Cost Accounting –Tulsian P.C. –Tata McGraw Hills.
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