Cost Accounting

Teacher

Ajitav Acharya

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Course Name : Cost Accounting

Code(Credit) : CUTM1684

Course Objectives

  • To understand the basic concepts and processes used to determine product costs,
  • To be able to interpret cost accounting statements,
  • To be able to analyze and evaluate the information for cost ascertainment, planning, control and decision making, and
  • To explain the concept and role of cost accounting in the business management of manufacturing and non-manufacturing companies.
  • To define the costs and their impact on value creation in the manufacturing and non-manufacturing companies.
  • Use accounting methods of cost calculation.

Learning Outcomes

  • Express the place and role of cost accounting in the modern economic environment,
  • Select the costs according to their impact on business,
  • Differentiate methods of schedule costs per unit of production,
  • Differentiate methods of calculating stock consumption,
  • Interpret the impact of the selected costs method,
  • Identify the specifics of different costing methods,

Course Syllabus

Unit 1:  Introduction

Meaning, objectives and advantages of cost accounting; Difference between cost accounting and financial accounting; Cost concepts and classifications; Elements of cost; Installation of a costing system; Role of a cost accountant in an organisation

 

Unit 2:  Elements of Cost: Material and Labour

a. Materials: Material/inventory control techniques. Accounting and control of purchases, storage and issue of materials. Methods of pricing of materials issues — FIFO, LIFO, Simple Average, Weighted Average, Replacement, Standard Cost. Treatment of Material Losses

b. Labour: Accounting and Control of labour cost. Time keeping and time booking. Concept and treatment of idle time, over time, labour turnover and fringe benefits. Methods of wage payment and the Incentive schemes- Halsey, Rowan, Taylor’s Differential piece wage.

 

Unit 3:  Elements of Cost: Overheads

Classification, allocation, apportionment and absorption of overheads; Under- and overabsorption; Capacity Levels and Costs; Treatments of certain items in costing like interest on capital, packing expenses, bad debts, research and development expenses; Activity based cost allocation.

Unit 4:  Methods of Costing

Unit costing, Job costing, Contract costing, Process costing (process losses, valuation of work in progress, joint and by-products), Service costing (only transport).

Unit 5:  Book Keeping in Cost Accounting

Integral and non-integral systems; Reconciliation of cost and financial accounts

 

 

Books Recommended:

 

  1. Banerjee, Cost Accounting, PHI
  2. Jawahar Lal & Seema Srivastava, Cost Accounting, TMH
  3. Y.Khan & P.K.Jain, Management Accounting, TMH
  4. Anthony, Management Accounting, Taraporewala

Session Plan

Session 1

Introduction to Cost Accounting, What is Cost Accounting? Objectives of Cost Accounting, Scope of Cost Accounting, Advantages of cost accounting
Difference between cost accounting and financial accounting

cost accounting Paper-8-New

https://www.youtube.com/watch?v=AwrwUf8vYEY

Session Plan

Session 2

Cost concepts, Cost classifications, Elements of cost, Direct & Indirect Material, Direct & Indirect Labour, Direct & Indirect Expenses
Preparation of cost sheet, Installation of a costing system

cost accounting Paper-8-New

https://www.youtube.com/watch?v=AwrwUf8vYEY

Session Plan

Session 3

Role of a cost accountant in an organization
Meaning and classification of materials
Meaning of Inventory or material control, Objectives of inventory control
Accounting and control of purchases, storage and issue of materials
Methods of pricing of materials issues — FIFO, LIFO,

cost accounting Paper-8-New

Session Plan

Session 4

Methods of pricing of materials issues- Simple Average, Weighted Average
Replacement, Standard Cost.
Treatment of Material Losses
Introduction and concept of Accounting and Control of Labour Cost
Time Keeping and Time Booking, Idle Time

cost accounting Paper-8-New

Session Plan

Session 5

overtime, labour turnover and fringe benefits.
Concepts of Methods of wage payment and the Incentive schemes
Halsey Plan, Rowan Plan, Taylor’s Differential Piece Wage
Case Study Analysis & Discussion
Classification of Overheads

cost accounting Paper-8-New

Session Plan

Session 6

allocation, apportionment of Overheads
absorption of overheads; Under- and overabsorption
Capacity Levels and Costs
Treatments of certain items in costing like interest on capital, packing expenses,
Treatments of certain items in costing like bad debts, research and development expenses

cost accounting Paper-8-New

Session Plan

Session 7

Activity-based cost allocation
Introduction to methods of costing
Introduction and concept of Unit costing and job costing
Introduction and concept of contract costing
Process costing (process losses, valuation of work in progress, joint and by-products)

cost accounting Paper-8-New

Session Plan

Session 8

Introduction and concept of Service costing
Book Keeping in Cost Accounting Integral and non-integral systems
Cont. Book Keeping in Cost Accounting Integral and non-integral systems
Reconciliation of cost and financial accounts
Cont. Reconciliation of cost and financial accounts

cost accounting Paper-8-New

Case Studies

Case Studies

Our Main Teachers

Ajitav Acharya is working as a faculty at at at Centurion University of Technology and Management, Bhubaneswar. He is having more than 10 years of experience in academics and industry. He is currently pursuing his Ph.D. at Utkal University. He has completed his MBA (Finance and Marketing) from Siksha ‘O’ Anusandhan University, MCom and Bcom […]