AIT704 - Management Accounting 2A

Outline info
Last revision date 2016-02-01 00:31:18.929
Last review date 2016-03-21 00:15:06.606

Subject Title
Management Accounting 2A

Subject Description
AIT 704 is a one semester subject in Advanced Management Accounting theory. Students will develop an understanding of the concepts essential for the design of effective management accounting and control systems. The focus will be on how managers use accounting information to make short-term and long-term decisions. Emphasis will be on the need of managers to adapt to change and to develop and implement new approaches to cost accumulation, to implement effective control systems, analyze business operations, and make relevant decisions. Agency theory, responsibility accounting, and ethical issues will also be studied.

Credit Status
This subject is a required credit in the Accounting and Information Technology Program. To qualify for the exemption from the CGA Management Accounting 2 (MA2) subject, students must achieve at least a "C+" in the subject.

Learning Outcomes
Upon successful completion of this subject the student will be able to:

1. Explain why management accountants must adapt to change.

2. Define the managerial accountant's role in the decision-making process and analyze the steps needed to make a financial decision.

3. Demonstrate the use of linear programming as a decision making tool.

4. Determine long-term investment decisions using various evaluation methods.

5. Discuss contemporary management accounting methods being implemented in organizations.

6. Explain how managers can use Activity-Based Management (ABM) to improve organizational performance and to manage costs.

7. Describe the agency theory and explain how goal congruence can be achieved, performance measured and internal and external labour markets handled.

8. Apply accounting systems to reduce agency problems through responsibility accounting and transfer pricing.

9. Discuss the role and the economics of ethics in agency theory.

10.Use the concepts from the assigned readings to structure recommendations regarding management accounting information.

Cheating and Plagiarism
Each student should be aware of the College's policy regarding Cheating and Plagiarism. Seneca's Academic Policy will be strictly enforced.

To support academic honesty at Seneca College, all work submitted by students may be reviewed for authenticity and originality, utilizing software tools and third party services. Please visit the Academic Honesty site on for further information regarding cheating and plagiarism policies and procedures.

All students and employees have the right to study and work in an environment that is free from discrimination and/or harassment. Language or activities that defeat this objective violate the College Policy on Discrimination/Harassment and shall not be tolerated. Information and assistance are available from the Student Conduct Office at

Accommodation for Students with Disabilities
The College will provide reasonable accommodation to students with disabilities in order to promote academic success. If you require accommodation, contact the Counselling and Disabilities Services Office at ext. 22900 to initiate the process for documenting, assessing and implementing your individual accommodation needs.

Students must meet the Program Eligibility Requirements as stated on the program web page:

Topic Outline
Introduction and cost terms

Cost Volume Profit and Linear Programming

Activity-Based Costing and Management

Master Budget

Capital Budgeting

Relevant Information and Decision Making

Pricing and Cost Management 

Strategic Management, Balanced Scorecard, Five Forces

Inventory Management, JIT, Backflush

Agency Theory, Control Systems, Transfer Pricing 

Performance Management, ROI, Residual Income 

Review, Case Due

Mode of Instruction
A combination of teaching methods will be utilized which may include lectures, case studies, discussions, group and individual work.

Prescribed Texts
Title: Cost Accounting & Managerial Emphasis
Edition: 6th Canadian Edition
Author(s): Horngren, Foster, Datar, Teall, Gowing
Publisher: Pearson Education/Prentice Hall
ISBN: 978-0-13-338940-1 (Text Only)

MA2 CD 2012. CGA Canada. 

Reference Material

Required Supplies

Promotion Policy

Grading Policy
A+ 90%  to  100%
A 80%  to  89%
B+ 75%  to  79%
B 70%  to  74%
C+ 65%  to  69%
C 60%  to  64%
D+ 55%  to  59%
D 50%  to  54%
F 0%    to  49% (Not a Pass)
EXC Excellent
SAT Satisfactory
UNSAT Unsatisfactory

For further information, see a copy of the Academic Policy, available online ( or at Seneca's Registrar's Offices.

Modes of Evaluation
Assignments are due on the dates specified. Should extenuating circumstances arise, please contact your instructor immediately, prior to when your assignment is due, so an appropriate course of action can be established. Late assignments may be subject to a penalty of up to 10% per week and will not generally be accepted beyond two weeks after the assignment due date.

In cases of cheating or plagiarism, the College Academic Policy will prevail.  Please ensure that all assignments and reports are properly documented.

Students are referred to the following web site for the Seneca College Library MLA Style Guides, Academic Honesty Policy and Copyright guidelines:  


Dates for evaluations are specified in the weekly schedule addendum to this outline. The evaluation process may include, but is not limited to, tests, exams, assignments or presentations. Any absences or missed submissions due to medical or other reasons must be supported by medical or other appropriate documentation within one (1) week of the due date. The faculty and program area must be notified immediately in the even of a missed evaluation. Upon acceptance of the documentation, the weighting of the missed deliverable will normally be applied to the final exam.

English Competency:

The ability to communicate effectively is essential for success in business. Therefore, you must demonstrate English competency in this course in both oral and written work. Ensure your written work includes correct sentence structure, spelling and punctuation. Always spell check, edit and proofread your work.

Grading is based on the following marking scheme:

Assignment 10%
Mid-Term Test 40%
Final Comprehensive Examination 50%

Please retain this course outline document for future educational and/or employment use.

Program Coordinator
Keith Chapin

Approved by: Jeff McCarthy