IAF530 - Management Accounting - Intermediate

Outline info
Last revision date 2018-07-20 11:24:19.397
Last review date 2018-07-20 11:24:30.515

Subject Title
Management Accounting - Intermediate

Subject Description
Continuing from the fundamentals covered in Management Accounting - Introductory, this course covers the intermediate concepts including the impact of organizational structure on cost structures, transfer pricing, cost allocation methods, flexible budgets and variance analysis, capital budgeting for long-term projects, the design and implementation of effective management control systems, and their impact on organizational behaviour. Ethical standards for and moral responsibilities of managers will be emphasized throughout the course. Pre-requisite: BAB240

Credit Status
One credit towards the Bachelor of Commerce - International Accounting and Finance degree programs

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

A. Management Accounting and Decision Making
1. Describe the impact of management control in centralized, decentralized and matrix organizations and evaluate and differentiate the challenges of management control in both manufacturing and service organizations including those in the public sector.
2. Define the managerial accountant's role in the decision-making process and analyze the steps needed to make financial decisions.

B. Activity-Based Management
1. Describe and justify the implementation of cost allocation and Activity Based Costing methodologies.
2. Identify the design of and use of Activity Based Costing systems.
3. Compute and defend the application of overhead applications.

C. Contemporary Approaches To Costing and Pricing
1. Develop and explain various budgets [static, flexible, master] and variances [price, efficiency, volume].
2. Explain the features of a Standard Cost system and its role in variance analysis.
3. Demonstrate the appropriate use of variance analysis by managers in specific situations.
4. Describe and evaluate the impact of various costing methods on the financial statements.
5.. Compare and contrast contemporary approaches to product costing and pricing including target costing, benchmarking, Kaizen, total life cycle costing, value engineering and quality costing including cost-plus pricing.

D. Making Short Run Decisions
1. Review how managers identify, analyze and assess relevant information in order to make decisions relating to special sales orders, make v. buy, add v. drop, process v. sell joint products, and other limited resources.

E. Decision Framing
1. Analyze and assess the principles of effective decision framing including the appropriate use of a regression model.
2. Analyze and formulate a linear programming model including objective function and all constraints to evaluate proposed production plans including purchase and sale timing, add-or-drop, make or buy decisions.

F. Performance Evaluation
1. Explain responsibility accounting and transfer pricing, their applications, limitations and relationship to agency theory.
2. Analyze, apply and evaluate economic value-added, balanced scorecard and transfer pricing policies with regard to the impact on performance evaluation.
3. Assess the impact of performance evaluation measures on management decision making with regard to long-term investments.

G. Ethics, Society and Accountants, and Integration
1. Analyze and evaluate trust, ethical behaviour and the role of the accountant.
2. Evaluate the role of social responsibility relative to competitive markets and organizational goals and objectives.
3. Integrate the application of management accounting information to financial accounting reporting and interpretation using the case study format.

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 http://library.senecacollege.ca 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 student.conduct@senecacollege.ca.

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.


Topic Outline

Introduction and Activity Based Costing
Case Analysis Approach 
Flexible Budgets and Variances
Case:  Spraakman case 15; Electronic Processing Equipment
Flexible Budgets and Variances
Revenue and Profitability Analysis
Case: Wilcox Microwave Pricing and Variance case (posted on course website)
Absorption and variable costing
Case: Spraakman Case 8; Consolidated Pump.
Relevant Costs and Product Pricing
Cost Allocation
Case: Spraakman Case 23: King Coal
Process Costing
Quality, Inventory Management and Theory of Constraints
Case: Spraakman Case 7; Coffee Maker Supreme
Balanced Scorecard
Case:  Spraakman Case 4; Brights Lodging and Travel
Management Control Systems and Transfer Pricing
Case: Spraakman Case13; Digital Air Conditioners.
Performance Measure and Compensation
Case: Birch Paper Case (posted on course website)
Performance Measure and Compensation

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: A Managerial Emphasis
EDITION: 7th  Canadian Edition
AUTHOR: Horngren, Datar, Rajan, Beaubien, Graham
PUBLISHER: Pearson Education Canada
ISBN:  9780133929157

ISBN-10: 0133929159

TITLE: Current Trends and Traditions in Management Accounting Case Analysis
EDITION: 6th edition
AUTHOR: Spraakman, Gary
PUBLISHER: Captus Press, Inc.  2007
ISBN: 978-1-55322-323-8

Reference Material
Guide to Research and Citiation MLA Style, Latest Edition

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 (http://www.senecacollege.ca/academic-policy) or at Seneca's Registrar's Offices.

Modes of Evaluation

Assignments(case studies, etc) 20%
Mid-Term Tests 40%
Final Exam 40%
TOTAL 100%

Please Note
  • Missed tests and assignments will receive a zero mark. 
  • Late assignments will not be accepted without prior discussion and approval 
  • In cases of cheating or plagiarism, the College's Academic Policy will apply. 
  • Students are required to demonstrate an appropriate level of professional communication in both written and oral communications. 
  • Assignments will be marked on the basis of an appropriate standard of research, content, organization of material and presentation. Assignments are to be grammatically correct and prepared on a word processor.  Up to fifteen percent of Marks will be deducted for grammatical and spelling errors and/or presentation. 
  • Regular attendance and active participation in discussions, cases, projects and presentations is expected.  Irregular attendance will have an adverse effect on marks.  

For applied degree programs, the minimum requirement for promotion and graduation is an average of  C+ (2.5) in subjects in the main field of study (professional subjects), and an average of C (2.0) in all other subjects. 

Expected English Competencies

The ability to communicate in writing is essential for success in all business subjects.
All written work must demonstrate the following characteristics for clarity and conciseness. 

Language Across the Curriculum Rubric

Clear   Confusing  
Good Detail   Lacks Detail  
Easy to follow   Difficult to follow  
Answers Question   Evades Question  

Seneca College Library Resources
Be sure to begin all your research, assignment support and career preparation at the Seneca College libraries website http://library.senecacollege.ca where you will find information about our services and collections including, print and e-books, databases that will lead you to thousands of articles in magazines, newspapers, journals, encyclopedias, carefully selected websites, how-to tutorials, streamed videos and much more.

Accounting & Financial Services Subject Guide
Go to http://seneca.libguides.com/content.php?pid=51134&hs=a for an online customized guide for accounting and financial services students that meets specific program needs – you will find library resources, websites, industry associations and organizations, a business glossary, career sites for accounting and financial services students and more.

For rules on citing your sources, consult Seneca Libraries' online MLA Citation Guide at http://seneca.libguides.com/mla, or purchase a print copy of the Guide to Research & Citation: MLA Style in the Seneca Bookstore.
Ensure that you do not commit plagiarism. Information on academic honesty, including the Academic Honesty and Plagiarism tutorial is available through the library at: http://seneca.libguides.com/academichonesty.

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

Program Coordinator
Cynthia Duncan

Approved by: Academic Program Manager - Business Studies Danielle Mercier