CENTRAL PHILIPPINE UNIVERSITY
COLLEGE OF BUSINESS AND ACCOUNTANCY
Jaro, Iloilo City, Philippines
A Study Guide in Acctg 1206
(Cost Accounting & Control, and Strategic Cost Management)
Course Information
Course Code
Course Title
Course Description
: Acctg 1206
: Cost Accounting & Control, and Strategic Cost Management
: This course is designed to orient the students to cost accounting and control
framework of business which will help them understand the factors and aspects
necessary to come up with an effective cost system. Its emphasis particularly dwells on
the manufacturing concern, and also highlights the elements and features applicable to
the non-manufacturing concerns.
It explores on the details of the key components of manufacturing from one department
to the next, specifically materials, labor and overhead and transcends into the
understanding of the flow of costs during the work in process stage until the completion
of goods. It exposes the students to different types of cost, cost accumulation
procedures such as job-order costing, backflush costing, ABC Costing, and process
costing in determining the unit cost of manufacturing a product, accounting procedures
for main products and incidental products that are manufactured simultaneously in a
common process. It encompasses the costing techniques and procedures for
companies that use standard costs as benchmark for costing the products. Students will
be exposed to the preparation of job cost sheets, cost of production report, cost of
goods, cost of the inventories to be reported in Income statement and balance sheet
and in the production of the necessary deliverables and reports pertinent to the cost
system and assemble financial statement prepared under standard costing procedures.
It will enhance the analyzing and problem solving skills of students while teaching them
the requisites of assessing the role of cost accounting as an indispensable tool for
management in planning and control for decision-making. Topics include introduction to
strategic cost management, absorption and variable costing, cost-volume and profit
analysis, budgeting for planning and control, responsibility accounting performance
evaluation, transfer pricing, pricing and profitability analysis. It also discusses the impact
on environmental concerns on cost and ethical considerations in costing.
Textbook:
Vanderbeck Edward J; & Mitchell, Maria R. Principles of Cost Accounting Seventeenth Edition, 2017 Cengage
Learning Asia Pte Ltd.
Don R. Hansen & Maryanne M. Mowen: Strategic Cost Management, 2019 C & E Publishing, Inc. Phil Edition.
References available at CPU’s Main Library:
Deleon, Guillermo, De Leon, Norma. (2016). Cost accounting. Manila, Philippines: GIC Enterprises & Co., Inc.
Hilton, R. and Platt, D. (2011). Managerial Accounting Golbal Edition. Mc Graw-Hill Companies, Inc.
Horngren, C. T., Datar, S. M., Rajan, M. V. (2013). Cost accounting: a managerial emphasis. 14th ed. Boston:
Pearson Education Limited.
Lanen, W. N., Anderson, S. W., Maher, M. W. (2011). Fundamentals of cost accounting 3e. 3rd ed. New York :
McGraw-Hill Companies, Inc.
Raiborn, Cecily A., and Kinney, Michael R., and Carter, William (2012). Cost Accounting. ESP Printers, Inc.
Reeve, J., Warren, C., and Duchac, J. (2012). Principles of Managerial Accounting 11th edition. South Western,
Cengage Learning.
Grading System
COMPONENTS
Second semester (2020-21)
A.
Midterm Exams
WEIGHTS
(%)
25%
1. Midterm Exam 1
2. Midterm Exam 2
B.
Final Exam
1. Final Exam 1
2. Final Exam 2
35%
C. Quizzes
25%
D. Other Requirements
15%
TOTAL
PASSING MARK
Transmuted Value =
General Weigthed Average−Passing Mark
100−Passing Mark
100%
60%
x 25 + 75
(Transmuted value of the final grade should be rounded off to the nearest whole number)
Standard Transmutation Table to Obtain the Final Grade
Transmuted Value
98-100
95-97
92-94
89-91
86-88
83-85
80-82
77-79
75-76
Below 75
Numerical Grade
1.00
1.25
1.50
1.75
2.00
2.25
2.50
2.75
3.00
5.00
Course Design
Note:
- Any changes in the schedule shall be announced in class.
- The course subject is a combination of synchronous and asynchronous learning.
Week
Time
Frame
Course content
Output
MODULE 4. Budgeting for Planning & Control, Cost-Volume-Profit Analysis (Chapter 1 – Mowen)
and Pricing & profitability analysis;
Budgeting for Planning & Control (Chapter 7 – Vanderbeck)
Week 11-12
Synchronous/
Asynchronou
Day 34 – 37
April 4, 5, 7, 8
1.Importance, advantages &
disadvantages
of Budget
On-line discussion with students
2.The Budgeting Process
Students will answer exercises.
3.The components of the Master Budget
Compliance of assignment.
4. Ethics in budget preparation
Quiz
Recitation
5.Preparation of
a. Sales Budget
b. Production Budget
c. Selling and administrative expense
budget.
d. Projected Income Statement
Cost-Volume-Profit Analysis (Chapter 1 – Mowen)
Day 38 – 41
1. Cost concepts, nature, and objectives
and underlying assumptions for the
On-line discussion with students
April 11, 12,
18, 19
Apr 14 - 15
HOLY WEEK
computation and use of break-even
Recitation
2. Computation of Breakeven Point using
a. Algebraic Approach
b. Contribution Margin Approach
c. Graphing Method Breakeven Chart
d. Construction of breakeven graph and
profit volume
e. Overall Contribution Margin to
Calculate Break-even of a multiple
products
Students will answer exercises.
Compliance of assignment.
Quiz
3. Impact of risk, uncertainty, and
changing variables on cost-volume-profit
analysis.
4. The Margin of Safety Linking Margin of
Safety Break-even CVP Considerations in
Choosing a Cost Structure
5. Operating Leverage Using Sales Dollar
Ratio and
6. Ethics on changing the items of cost
and its effect on the break-even.
Week 12 13
Pricing & profitability analysis (Chapter 2 – Mowen)
Synchronous/
Asynchronou
Day 42 - 45
April 21, 22,
25, 26
A. BASIC PRICING CONCEPTS
1.Demand & Supply
2.Price Elasticity of Demand
3 Market Structure & Price
On-line discussion with students
Recitation
Students will answer exercises.
B. COST & PRICING POLICIES
1. Cost-Based Pricing
2. Target Costing & Pricing
3. The Legal System & Pricing
Compliance of assignment.
Quiz
4. Concept, format and importance of
variable costing and its differences from
the advantages over absorption costing.
C. Measuring Profit using
1. Absorption Costing Approach
2. Variable costing approach
Week 14
Day 46 - 49 - FINAL EXAMINATION I
APRIL 28 – 29, MAY 2
MODULE 5. Decentralization Responsibility Accounting, Performance Evaluation, and
Transfer Pricing; Activity Resource Usage Model and Tactical decision making; Strategic
cost Management and Balance Score Card
Week 15
Decentralization Responsibility Accounting, Performance Evaluation, and Transfer Pricing (Ch6 –
Mowen)
Synchronous/
Asynchronou
1.Responsibility Accounting, its type & role
On-line discussion with students
2.Decentralization
2.1 Reasons for Decentralization
2.2 The Units of Decentralization
Recitation
3.Measuring the Performance of
Investment Centers
3.1 Return on Investment
3.2 residual Income
3.3. Economic Value added
Compliance of assignment.
Day 50-52
May 5, 6, 9
May 1,
Laboy day
May 3
Eid l Ftr
4.Measuring & rewarding the
Performance of Managers
4.1 Incentives Pay
4.2 Congruence
4.3 Managerial Rewards
4.4 Measuring Performance in the
Students will answer exercises.
Quiz
Multinational Firm
5.Transfer Pricing-Its impact to income
6.Setting Transfer Price
a) Market Price
b) Negotiated Price
c) Cost-based Transfer Price
7.Transfer Price & the Multinational Firm
Week 16-17
Activity Resource Usage Model and Tactical decision making (Chapter 3 – Mowen)
Synchronous/
Asynchronou
Day 53 - 56
May 10, 12,
13, 16
A. Tactical Decision Making.
On-line discussion with students
B. Relevant Cost and Revenues
Recitation
C. Activity Resource Model
Students will answer exercises.
Illustrative Example of Tactical DecisionMaking
Compliance of assignment.
Quiz
1.Make or Buy Decision
2. Keep or Drop decisions
3.Special Order Decision
4.Decision to Sell or Process Further
5. Qualitative and Ethical Consideration in
decision making
Strategic cost Management (Chapter 7 – Mowen)
Day 57 - 59
1. Basic Strategic Cost Concepts
On-line discussion with students
May 17, 19,
20
2. Strategic Positioning: Key to Creating
Value and Sustaining a Competitive
Advantage
a) Cost Leadership
b) Differentiation
c) Focusing
Recitation
Students will answer exercises.
Compliance of assignment.
Quiz
3. Value Chain
4. Analysis framework, linkages and
Operational activities
5. Life Cycle Cost Management and its
uses in maximizing profits over the
product’s life cycle.
Week 18
Balance Score Card (Chapter 9 – Mowen)
Synchronous/
Asynchronou
Day 60 - 61
May 23-24
1.Basic Concept of Balanced Score Card
with its four perspectives such as Learning
& Growth,
Process, Customer & Financial
On-line discussion with students
Recitation
Students will answer exercises.
Compliance of assignment.
2. Cycle Time & Velocity
3. Manufacturing Cycle Efficiency (MCE)
WEEK 19
Day 62 - 65 – FINAL EXAMINATION 2
MAY 26-27, 30-31, 2022
Quiz