Cost Accounting Decisions

Overview/Description
 Cost accounting is an activity that provides financial and nonfinancial information to business managers and other internal decision makers of an organization. This course examines how cost accounting information is gathered, and how it is used by business professionals to make effective decisions. Topics such as Cost-volume-profit (CVP) Analysis, Standard Costing and Variance Analysis, and Activity-based Costing (ABC) will provide you with the concepts, procedures, and analytical skills you'll need to make cost accounting decisions in today's complex business environment.

Target Audience
 This course is targeted specifically for business managers, financial professionals, and other internal decision makers of an organization who have the need to understand managerial accounting.

Expected Duration
4.0 hours

Lesson Objectives:

Cost-volume-profit (CVP) Analysis

  • recognize the benefit of using cost-volume-profit analysis tools for making business decisions.
  • recognize the relationship between changes in sales activity, contribution margin, and net income.
  • calculate the change in net income for a specified increase in sales.
  • compute the contribution margin ratio, given a company's specific sales data.
  • determine the effectiveness of a specified business plan to increase sales, using the contribution margin ratio in a given scenario.
  • identify the formulas used to compute a break-even point and unit sales required to achieve a target profit.
  • use cost-volume-profit formulas to compute a given company's break-even point and unit sales required to achieve a target profit.

    • Standard Costing

  • recognize the benefits of using standard costing for making managerial decisions.
  • recognize a description of how total standard costs per unit are allocated.
  • allocate standard costs for specified units in a given manufacturing scenario.
  • distinguish between direct and absorption costing.
  • calculate the unit product cost using both absorption and direct costing approaches, given a company's cost structure.
  • match given production scenarios with the appropriate costing system for each.
  • compute the product costs for given companies, using the appropriate costing system for each.

    • Activity-based Costing (ABC)

  • recognize the benefits of using activity-based costing.
  • link specified activities and costs to activity cost pools, in a given scenario.
  • identify the calculation for computing the activity rate for a given activity.
  • recommend the activity in a given business scenario that will benefit the most from process improvement.

    • Course Number: FIN0244