The University of North Carolina at Greensboro
Bryan School of Business and Economics
Department of Accounting and Finance
Spring, 2010
MBA 612 - Cost Management Systems
Instructor:
Dr David Upton
Office:
323 Bryan
E-mail:
drupton@uncg.edu
Telephone:
256-0186
Course Website:
The course will use Blackboard for electronic communications and postings
Office Hours:
Tuesday 11.00am-12.00noon and Thursday 4:0pm-5:30pm. Anytime I am in
my office you may call or stop by to ask questions. I ask that you make an appointment for longer
discussions. You may leave messages on my door, or in my mailbox in the Department Office, Room
383. My home phone number is 336/286-5598, and you can call me at home if you have trouble
reaching me elsewhere, or if you have an emergency.
Course Prerequisite: MBA 602
Course Objective
Managerial Accounting is a discipline that involves developing and using financial and non-financial
information to help managers in planning, controlling, and decision-making. The following are the
objectives of this course:




To help you understand the role of accounting in the planning, controlling and decisionmaking functions of the management process.
To help you understand the major theoretical and practical issues impacting on management’s
use of accounting information for planning, controlling and decision-making.
To help you utilize analytical and problem solving skills, through the application of managerial
accounting concepts to the solution of practical problems and case studies.
To help you understand the limitations of traditional managerial accounting systems and the
benefits of contemporary systems in sustaining competitive advantage and spurring
innovation.
To achieve these objectives, the course will (1) cover the basics of many of the standard managerial
accounting methods used in organizations; (2) provide the skills necessary to use managerial
accounting information to make business decisions; (3) illustrate how managerial accounting
information can be used to formulate and implement strategy in a variety of organizational
environments; and (4) demonstrate how the design of managerial accounting systems affect innovation
and human behavior in organizations.
Student and Faculty Guidelines
Please refer to the faculty and student guidelines for general expectations for this class:
http://www.uncg.edu/bae/faculty_student_guidelines_sp07.pdf
Textbook
Managerial Accounting: An Introduction to Concepts, Methods, and Uses by M.W. Maher, C.P.
Stickney, and R.L. Weil, Thomson Publishing (South-Western), (tenth edition) ISBN for the text is 0-32463976-7
Required case
John Deere Component Works (A) (Harvard case #: 9-187-107)
This case can be purchased directly from Harvard Business Online.
http://harvardbusinessonline.hbsp.harvard.edu/
Grades
Final grades will be assigned based on the grade scale presented below.
The basis for grades is as follows:
93+
90-92
87-89
83-86
80-82
77-79
70-76
0-69
A
AB+
B
BC+
C
F
Assignment
Homework
Midterm Exam
Final Exam
Grade Percentage
30%
30%
40%
Participating in Classroom Discussion
Participating in class provides you with the opportunity to gain from the diverse experiences and
talents of your colleagues. To facilitate class discussion, I will sometimes call on volunteers in class,
but I will also call on you even if you have not volunteered. I will do this for two reasons. First, it is
necessary for your future success that you be able to articulate your views and defend them when
others in your organization request your opinion. Second, it increases the level of preparation for
class. When I call on you, I do not expect you to necessarily have "The" answer, even if there is one. I
expect you to indicate a familiarity with the issues of the case, problem or chapter under discussion
and be willing to share your opinion with your colleagues.
Homework
Homework problems are assigned to enhance your understanding of accounting concepts, rules, and
techniques, and to understand how accounting information is used in business settings. You are
required to turn in assigned problems on the due dates as given in the schedule below. In total, five
homework assignments should be turned in during this course (four homework sets and one assignment
related to the John Deere case). Solutions to homework problems will be posted on Blackboard soon
after the due dates for the problems. You should submit hard copies of your assignments to me in class.
If you are unable to attend class, you should email your assignment to me (drupton@uncg.edu) before
the start of the missed class. NO LATE HOMEWORK WILL BE ACCEPTED.
Homework grading will be based in part on effort and not solely on the correctness of your answers.
You can discuss your assignments with others, and you may ask the instructor for assistance (via email,
in person, or by phone), but the work you turn in should be entirely your own. Copying other
students’ work is viewed as academic misconduct and will be responded to accordingly. NOTE: Failure
to diligently work through homework problems is usually a recipe for failure in the course. Working
diligently on the problems will significantly enhance your understanding of the course material and
take you much further toward passing and obtaining a good grade in the course.
Class format
I will begin each class with a lecture on major theoretical concepts and techniques, practical
applications, and innovative approaches, as appropriate. Following the lecture, you will work on preassigned problems to test your understanding of the concepts and techniques learned in the lecture.
This will reinforce your understanding of the course material and prepare you for the challenging
problems in the homework and the exams. These problems typically do not have as much background
information or detail as the conventional cases do and so enable us to get to the issue quickly. I will
post the questions on Blackboard well in advance of the scheduled class (some in-class exercises are
listed on the schedule under the “IC” label). I encourage you to attempt these questions to the best of
your ability before class and come prepared to discuss possible solutions. You can then have another
attempt at answering the questions in class after the concepts and techniques have been presented in
the lecture. You are permitted to work on these assignments with other students. In class, you are
permitted to use any resource to answer the questions like lecture notes, book, calculators, etc. I will
also assist you if you encounter difficulties in answering these questions. You are not required to turn
in your answers to these in-class assignments. We will discuss the solutions in class. This discussion
will enable you to fill in any gaps in your understanding of the basic concepts and tools in the course.
The solutions to these problems/mini-cases will be posted on Blackboard after class. I am not simply
looking for correct answers but a willingness to participate in the class discussions and, more
importantly, a good articulation of your thought processes.
I have also included warm-up exercises for each topic (please see the schedule). Use these exercises to
gain extra experience working problems. Solutions for these exercises are provided on Blackboard.
Harvard Business Review Articles
The Harvard Business Review articles posted on Blackboard provide you with additional practicerelated information on the topics taught in this course. These articles are written by leading
management thinkers and will encourage you to think of innovative ways of applying the topic in your
organization. I encourage you to read the relevant articles before the scheduled class.
Academic Integrity Policy
Each student is expected to complete all requirements of this course in all respects in conformity with
UNCG’s Academic Integrity Policy. The paragraph below, which was taken from this policy, highlights
students’ responsibilities regarding academic integrity.
Students should recognize their responsibility to uphold the Academic Integrity Policy and to
report apparent violations to the appropriate persons. Students who do not understand the
policy or its application to a particular assignment are responsible for raising such questions
with their faculty member.
You may want to examine the Academic Integrity Policy yourself at:
http://academicintegrity.uncg.edu/complete/
Other Comments
While it is understood that graduate students have busy schedules that include business conflicts,
please exercise good judgment in missing class only when necessary. Part of this responsibility is to
understand that assignments will be accepted early, but no assignment will be accepted late. In the
event that you must miss class, assignments due at the beginning of class can be sent electronically,
but must be received prior to the start of the class. You may make arrangements with me to take
tests early; no tests will be given late. Keep in mind, in a class meeting for only 7 weeks absences can
quickly become a problem. Thus, excessive absences can result in indirect grade reductions.
There are no opportunities for extra credit in this course.
The material in this course may be difficult for some. However, it is vital to your professional success.
If you are having problems understanding the topics presented, see me. Don’t wait until it is too late.
Since this course builds on cumulative knowledge, problems in the early portion of the class will only
compound as the semester progresses.
TOPICS AND ASSIGNMENTS – Weekly Schedule
Note: Any clarification or revision in the assignments will be announced in class. Announcements may
also be sent via email lists maintained by the Bryan School.
WEEK ONE – Part 1: Overview and Basic Concepts
Reading
Date
Topic
03/16
(1) Managerial Accounting Framework
Read HBR article: “You Need A New Cost System
When…”, by Robin Cooper.
In-Class Focus:
 Discussion of course objectives, format,
schedule, and requirements.
 Lecture: Introduction to managerial
accounting.
(2) Product Costing
Read HBR article: “One Cost System Isn’t Enough”,
by Robert Kaplan.
Warm Up
Exercises
Work Due
C1
1.21, 1.23,
1.26
None
C2, 33-45
C5, 141-150
2.28, 2.34,
2.43
IC 2.37*
In-Class Focus:
 Lecture: Introduction to product costing –
basic cost concepts: cost classification, cost
assignment, and cost behavior.
 Lecture: Discussion of cost allocation.
 Lecture: Discussion of traditional costing
techniques.
 In-class exercises and discussion of solutions.
* IC numbered items refer to in-class problems. I encourage you to attempt these problems prior to
the class session. We will develop answers to these problems during class sessions.
WEEK TWO
Date
Topic
Reading
Warm Up
Exercises
Work Due
03/23
(3) Activity-Based Management
Read HBR articles:
“Time-Driven Activity-Based Costing”, by Robert
Kaplan and Steven Anderson.
C3
3.27, 3.28
IC 3.39
HW 2.44
(4) Cost-Volume-Profit (CVP) Analysis
Read HBR article: “Vital Truths About Managing
C6
Your Costs”, by Charles Ames and James Hlavacek.
6.18, 6.22,
6.29
IC 6.31
Warm Up
Exercises
Work Due
7.22, 7.28,
7.38, 7.60
IC 7.46
In-Class Focus:
 Lecture: Introduction to activity-based
costing (ABC).
 Lecture: Discussion of activity-based
management (ABM) and how it benefits
management.
 Lecture: Discussion of the limitations of
traditional costing systems and the benefits
of contemporary costing systems.
 In-class exercises and discussion of solutions.
In-Class Focus:
 Lecture: Discussion of CVP techniques and
how they aid management in short-term
decision-making.
 In-class exercises and discussion of solutions.
WEEK THREE – Part 2: Managerial Decision Making
Reading
Date
Topic
03/30
(5) Tactical Decision Making
In-Class Focus:
 Lecture: Discussion of differential analysis,
pricing, and other strategic short-term
decision-making techniques.
 In-class exercises and discussion of solutions.
(6) Case and Mid-Term Exam Review
In-Class Focus:
 Discussion of John Deere Component Works
(A).
C7
HW 3.36
HW 6.34
Case
Write-up
WEEK FOUR
Date
Topic
Reading
06/04
(7) EXAM – held in class – C1, 2, 3, 5, 6
Warm Up
Exercises
Work Due
Mid-term
Exam
Part 3: Motivating Managers to Make Good
Decisions
(8)
 Experiment
WEEK FIVE
Date
Topic
Reading
Warm Up
Exercises
Work Due
13/04
(9) Budgeting
Read HBR articles:
“What Kind of Management Control Do You
Need?”, by Richard Vancil.
C9
9.21, 9.25,
9.36, 9.38
HW 7.57
HW 7.61
(parts a-d)
IC 9.39
IC 9.48
C10
10.28, 10.29
In-Class Focus:
 Lecture: Discussion of budgeting and how it
assists management.
 In-class exercises and discussion of solutions.

(10) Variance Analysis
In-Class Focus:
 Lecture: Discussion of variance analysis
techniques and how they assist management.
 In-class exercises and discussion of solutions.
WEEK SIX
Date
Topic
20/04
(11) Transfer Pricing
Read HBR article: “Control with Fairness in
Transfer Pricing”, by Robert Eccles.
In-Class Focus:
 Lecture: Discussion of transfer pricing
techniques and their use to management.
 In-class exercises and discussion of solutions.
(12) Performance Evaluation, Course Wrap-Up
and Exam Review
Read HBR articles:
“Using the Balanced Scorecard as a Strategic
Management System”, by Robert Kaplan and
David Norton.
Reading
Warm Up
Exercises
Work Due
C11
11.21,
11.29
HW 9.44
HW 10.57
IC 11.33
C11
C12, 433-439
11.22,
11.32
IC 11.37
In-Class Focus:
 Lecture: Discussion of return on investment
(ROI).
 Lecture: Discussion of economic value added
(EVA®).
 Lecture: Discussion of the balance scorecard
(BSC).
 In-class exercises and discussion of solutions.
 Course Review
 Final Exam Review
WEEK SEVEN
Date
Topic
Reading
27/03
EXAM – held in class: C7, 9, 10, 11, 12
(All topics are tentative and subject to change)
Warm Up
Exercises
Work Due
Final Exam