MANAGEMENT
ACCOUNTING
COURSE OUTLINE
▪ Unit 1: Management Accounting – An Introduction ..................................................................................... 6
▪ Unit 2: Classification of Costs ..................................................................................................................... 12
▪ Unit 3: Materials .......................................................................................................................................... 21
▪ Unit 4: Labour .............................................................................................................................................. 35
▪ Unit 5: Absorption Costing and Marginal Costing ............................................................................. ........ 55
▪ Unit 6: Cost-Volume-Profit Analysis ........................................................................................................... 69
▪ Unit 7: Budgets and Budgetary Control........................................................................................ .............. 99
▪ Unit 8: Standard Costing ........................................................................................................................... 123
▪ Unit 9: Capital Investment Appraisal ........................................................................................................ 144
UNIT 5: ABSORPTION COSTING AND
MARGINAL COSTING
▪ Calculation of the manufacturing cost per unit
5.1
INTRODUCTION
▪ In a period
▪ Total Manufacturing costs / units produced
▪ needed for
▪ Manufacturing costs
▪ Units sold and on hand
▪ Net Profit
▪ Absorption costing and marginal costing
5.2 DIFFERENCE IN MARGINAL AND
ABSORPTION COSTING
▪ Marginal costing = direct costing or
▪ Absorption costing = full costs
▪ Manufacturing cost
▪ Manufacturing cost
▪ Both variable and fixed
▪ Fixed cost are a product cost
variable costing
▪ Direct material
▪ Direct labour
▪ Variable manufacturing costs
▪ Marginal income = all variable costs
▪ Fixed manufacturing oosts = period
costs
method or total cost
5.2 DIFFERENCE IN MARGINAL AND
ABSORPTION COSTING
5.3 INCOME STATEMENT PREPARATION
5.3 INCOME STATEMENT PREPARATION