SAMPLE
NEW YORK UNIVERSITY
Stern School of Business
Advanced Managerial Accounting
Cost Analysis For Decision Making, Forecasting And Performance Measurement
Fall 2007
Prof. Alex Dontoh
Room 10-72 KMEC, x 80064
Off. Hrs: TR: 3:30-5:00p and by appointment.
E-mail: adontoh@stern.nyu.edu
COURSE OBJECTIVES
Cost information and management initiatives provide accurate cost and other relevant information
for business decision making. In particular, cost management plays a key supporting role in efficient
running of businesses in highly competitive environments. The course is designed to give students
insight into the use and limitations of cost accounting information in business decision making. The
objective is to teach the tools and techniques for successfully implementing cost management
strategies and techniques including the design and use of cost measurement and evaluation systems
in manufacturing and service businesses. The skills learned in this course should be highly relevant
for accountants and managers including consultants and managers of financial services.
COURSE FOCUS
The course focuses on using accounting information as a decision maker, rather than on preparing
the information. An ability to think systematically about how the existing reporting systems in any
given setting can be improved upon so as to better serve managerial informational needs for planning
and control will be stressed. The skills learned in this course should be highly relevant for all
managers, particularly consultants and managers of financial services. The tools include designing
and using measurement systems and incentive systems. The course tools are applicable for both
manufacturing and service companies. The tools are equally applicable to established companies as
well as startups. The key issue is that any of these organizations can benefit from cost management
systems that accurately provide information and that facilitates integration of initiatives such as total
quality, new product and service design, and cost reduction and business process improvement that
enhances their competitiveness and profitability of operations. Students will be given ample
opportunity to apply cost concepts to analyzing real world business problems through a series of
problems and case studies. Students will be required to define, analyze, solve and communicate their
solutions to unstructured problems.
COURSE CONTENT AND ORGANIZATION
The course starts with an introductory section on the structure and design of cost systems and moves
on to examine the role of information systems in cost control, and employees learning and
continuous improvement activities. There will be a comprehensive coverage of Cost information in
decision analysis. Numerical and computer exercises will be used throughout the course for handson experience with measurement systems and for reinforcing concepts learned in the cases.
Course text (required): Custom text comprising of chapters 1-9 of Quantitative Methods for Business 10th
edition by David R. Anderson, Sweeney and Williams and chapters 8-10 of Management Accounting: The
Cornerstone for Business Decisions by M. Mowen and D. Hansen Thomson Southwestern Publishing 2006)
GRADING POLICY AND DESCRIPTION
Makeup of Course Grade:
Final Exam
Midterm Exam
Class Participation
Quizzes
Homework Assignments
35 %
25 %
15 %
10 %
15 %
COURSE POLICIES
Attendance
 Class attendance is mandatory and part of a student’s grade. Absences may be
excused only in the case of documented serious illness, family emergency, religious
observance, or civic obligation. If you will miss class for religious observance or
civic obligation, you must inform me no later than the first week of class. Recruiting
activities are not acceptable reasons for class absence.
 Students are expected to arrive to class on time and stay to the end of the class
period. Chronically arriving late or leaving class early will have an impact on a
student’s grade. Students may enter class late only if given permission by the
instructor and can do so without disrupting the class.
Class Participation
 Individual and Group participation is an essential part of learning in this course.
Students are expected to participate in all facets of classroom learning.
Reading/Homework
 Students are expected to come to class prepared having read text and assigned
readings prior to class. Homework, case studies, and other assignments are expected
to be completed and handed in on time.
Late Assignments and Make-up Policy
 Late assignments will either not be accepted unless due to documented serious illness
or family emergency or will incur a grade penalty unless due to documented serious
illness or family emergency.
 Exceptions will be made for religious observance or civic obligation only when the
assignment cannot reasonably be completed prior to the due date and the student
makes arrangements for late submission with the professor in advance.
Classroom Norms
 If applicable, note your preference regarding food in class.
 Laptops, cell phones, Smartphones and other electronic devices are a disturbance to
both students and professors. All electronic devices must be turned off prior to the
start of each class meeting.
ETHICAL GUIDELINES
Student Code of Conduct
All students are expected to follow the Stern Code of Conduct
(http://www.stern.nyu.edu/uc/codeofconduct)
A student’s responsibilities include, but are not limited to, the following:
 A duty to acknowledge the work and efforts of others when submitting work as
one’s own. Ideas, data, direct quotations, paraphrasing, creative expression, or
any other incorporation of the work of others must be clearly referenced.
 A duty to exercise the utmost integrity when preparing for and completing
examinations, including an obligation to report any observed violations.
STUDENTS WITH DISABILITIES
 Students whose class performance may be affected due to a disability should notify
the professor immediately so that arrangements can be made in consultation with the
Henry and Lucy Moses Center for Students with Disabilities
http://www.nyu.edu/csd/ to accommodate their needs.
TOPICAL OUTLINE AND COURSE SCHEDULE
9/4
9/6
Preliminaries – Course policies
Introduction to Decision Models
Reading: Ch. 1 of ASW
Discussion Problems: 1-10, 1-12, 1-14
SECTION I
A.
DECISION MAKING UNDER UNCERTAINTY - THE VALUE OF INFORMATION
9/11 - 9/13 Assessing Uncertain Events
- Review of Probability Theory and Distributions
Reading: Chs. 2&3 of ASW
Discussion Problems: 2-8, 2-21, 3-14, 3-26
Case: Problem: Carstab Corporation
Homework Assignment 1 Due 9/18: 2-4;2-22;3-7; 3-26
9/18-9/20 Decision Analysis under Uncertainty
Reading: Ch. 4 of ASW
Discussion Problem: 4-9, 4-18, 4-19
Case: Problems: Oceanview Dev. Corp (pg. 144 of ASW), Edgarton Fisheries
Homework Assignment 2 Due 10/2: 4-4; 4-14; 4-21
9/25
Section Recap and Quiz
B.
STRATEGIC DECISION MAKING
9/27; 10/2 Utility Maximization in Decision Making
Reading: Ch. 5 pgs.154-164 of ASW
Discussion Problem: 5-2, 5-4
Case: Problem: Alberson
Homework Assignment 3 Due 10/4: 4-4; 4-14; 4-21
10/4;
10/9
Strategic Decision Making – Introduction to Game Theory
Reading: Ch. 5 pp/ 164-172. of ASW
Discussion Problem: 5-11, 5-12
Section Recap and Quiz
C.
PRODUCT AND SERVICE COST OPTIMIZATION MODELS
10/11;10/16 Introduction to Linear Programming
Reading: Ch. 7 of ASW
Discussion Problem: Fraser Farms
Group HW Assignment (4): Katastrofik Chemicals - Due 10/25
10/18;10/23 Linear Programming – Multiple Product Cost Accounting
Reading: Ch. 8 of ASW
Case Problem: Cholestrol Chemicals
10/25
10/30
11/1
Linear Programming – Service Costing Applications
Reading: Ch. 9 of ASW
Case Problem: Investment Strategy;
Section Recap and Midterm Exam Review
Midterm Exam
SECTION II
COST PREDICTION AND FORECASTING
11/6-11/8
Cost Estimation - Regression Analysis
Reading: Ch. 6 of ASW
Case Problem: Franklin Furniture;
Group HW Assignment (5): Forecasting Sales - Due 11/15
11/13-11/15 Cost Estimation - Regression Analysis
Reading: Ch. 8 of H&M
Case Problem: Franklin Furniture;
11/20
Section Recap and Quiz
SECTION III
MEASURING BUSINESS AND FINANCIAL PERFORMANCE
11/27; 11/29 Standard Costing, Kaizen and Target Costing
Reading: Chapter 9 and Appendix 9B of M&H
Discussion Problem: Ex 9-14, Problem 9-2
Case: Problem 9-14 of M&H.
Group HW Assignment (6): 9-12, 9-13; 9-14- Due 12/6
12/4; 12/6 - Budgets and Profit Planning For Future Operations
Role of budgets in planning, control, and decision making.
Reading: Chapter 8 of M&H
Discussion Problem: Ex 8-10, 8-11, 8-12
Case: Fraser Farms
12/11
Section Recap and Final Exam Review