Engineering Economics and Costing

Teacher

DR. RUPSA MAHAPATRA

Category

Core Courses

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Course Name : Engineering Economics and Costing

Code(Credit) : CUTM1012 (2-0-1)

Course Objectives

  • Facilitate students to understand the basics of Economics and its application in the field of engineering
  • Enable students to understand the concepts of the time value of money and techniques for evaluation of engineering project
  • Equip students with the skills required to understand cost statements/records of the product and its effect on decision making

Course Outcomes

  • Apply the microeconomics concepts related to business and its impact on enterprise
  • Develop an awareness and understanding time value of money and techniques for evaluation of engineering project
  • Apply cost concepts to analyse common business management decisions such as pricing a product and services.
COS COURSE OUTCOMES MAPPING COS WITH POS (High-3; Medium-2; Low-1)
CO1 Apply the microeconomics concepts related to business and its impact on enterprise PO1(3)
CO2 Develop an awareness and understanding time value of money and techniques for evaluation of engineering project PO6(3), PO2(2)
CO3 Apply cost concepts to analyse common business management decisions such as pricing a product and services. PO6(3), PO3(2)

Course Syllabus

Module-I
Engineering Economics – Nature and scope, General concepts on micro & macro economics. The Theory of demand, Demand function, Law of demand and its exceptions, Elasticity of demand, Law of supply and elasticity of supply.
Theory of production, Law of variable proportion, Law of returns to scale.

Module-II

Time value of money: Simple and compound interest, Cash flow diagram, Principle of economic equivalence.

Evaluation of engineering projects: Present worth method, Future worth method, Net present value method, internal rate of return method, Cost-benefit analysis in public projects.

Depreciation: Meaning Causes, Factors affecting depreciation, Methods of providing depreciation, Straight Line Method & Diminishing Balance Method

Module-III

Cost concepts, Elements of costs, Preparation of cost sheet, Segregation of costs into fixed and variable costs. Break-even analysis (Simple numerical problems to be solved)

Indian Banking System: Banks: Meaning, nature, characteristic of the Indian banking system, functions of commercial banks, functions of Reserve Bank of India, Overview of Indian Financial System.

 

Text Books:
1. Riggs, Bedworth and Randhwa, “Engineering Economics”, McGraw Hill
Education India.
2. D.M. Mithani, Principles of Economics. Himalaya Publishing House
Reference Books 
1. Sasmita Mishra, “Engineering Economics & Costing “, PHI
2. Sullivan and Wicks, “ Engineering Economy”, Pearson
3. R.Paneer Seelvan, “ Engineering Economics”, PHI
4. Gupta, “ Managerial Economics”, TMH
5. Lal and Srivastav, “ Cost Accounting”, TMH

Session Plan

Session 1

Nature and scope, General concepts on micro & macro economics

Presentation:Introduction to ME

https://www.youtube.com/watch?v=PHe0bXAIuk0&feature=youtu.be

Session 2

The Theory of demand, Demand function, Law of demand and its exceptions

Presentation: Demand Analysis

https://www.youtube.com/watch?v=WZ0I9t9QoZ0

Session 3 & 4

Elasticity of demand-Price Elasticity, Income Elasticity, Cross Elasticity and Promotional Elasticity

Presentation: Elasticity-Supply and Demand-Applications

https://www.youtube.com/watch?v=VhKI8cOaYLI&feature=emb_logo

Session 7

Session 9 & 10

Project: Assess demand and supply of of a particular firm in the wake of COVID-19

Session 11

Concepts of Time value of money, Simple and compound interest, Cash flow diagram, Principle of economic equivalence

https://www.slideshare.net/ZahraMirzayeva/chapter-2time-value-of-money-ppt

Small Story on Power of Compounding

https://www.youtube.com/watch?v=SKkH38hhWSo

Simple vs. Compound Interest

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

Session 12

Future Worth - Fundamentals of Engineering Economics

https://www.youtube.com/watch?v=2nYkCfdiC3E

Present Worth - Fundamentals of Engineering Economics

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

Session 13, 14

Case Study on the time value of money

http://www.allfinancejournal.com/article/view/5/1-1-5

Project on the time value of money

Students’ Presentation

Session 15

Evaluation of engineering projects: Present worth method, Future worth method, Net present value method, internal rate of return method, Cost-benefit analysis in public projects.

https://www.slideserve.com/emerald-mills/chapter-5-project-evaluation-principles-and-methods

Session 16

Session 17, 18, 19

Case Study on evaluation of a project

http://www.ergen.gr/files/CapitalBudgetingAndInvestmentDecisions.pdf

Project on the evaluation of a project

Students’ Presentation

 

 

Session 20

Depreciation: Meaning Causes, Factors affecting depreciation, Methods of providing depreciation, Straight Line Method & Diminishing Balance Method

https://www.slideshare.net/vikasvadakara/depreciation

https://www.youtube.com/watch?v=6SY8s1_OEro

Session 21

Practice problem on the calculation of depreciation on straight-line method & diminishing balance method

Session 23

Preparation of Cost Sheet

Practice Problem

https://www.youtube.com/watch?v=PBGGa1v4JrY&t=5s

Session 25, 26

Project on Preparation of Cost Sheet of Small Business

Field studies for collecting the data for preparation of Cost Sheet

Students' Presentation

Session 27

Marginal costing and break-even analysis (Marginal cost equation, contributions, PV ratio, BEP and margin of safety)

https://www.slideshare.net/sanchitgangar/accounts-marginal-costing

https://www.youtube.com/watch?v=TJ4gadZnZq4

Session 28

Project on Preparation of Cost Sheet of Small Business by considering Marginal Counting

Field studies for collecting the data for preparation of Cost Sheet

Students' Presentation

Session 29

Introduction to Bank, Characteristics of Indian Banking System, Role of Banks

https://www.slideshare.net/1954bvr/meaning-definition-and-functions-of-banking

https://www.youtube.com/watch?v=AI8cdTLD_T4

Session 30

Role and Functions of Reserve Bank of India

Case Study of State Bank of India

https://www.fujitsu.com/global/Images/CS_2015Sep_State_Bank_of_India_V4.pdf

https://www.youtube.com/watch?v=Bqyek4dnycM

Session 31

Commercial Banks and their Functions

https://www.youtube.com/watch?v=wlsOeE346SI

Students' Presentation

Case Studies

Case Studies

Our Main Teachers

Dr. Mahapatra is working as an Assistant Professor (Finance) at Centurion University of Technology & Management. She holds a master’s degree in finance from Ravenshaw university. After that she did her Master in Philosophy degree (M.Phil. in Management) from Ravenshaw University. She has also completed her Ph.D. in Commerce from Ravenshaw University. She has more […]

Kalee Prasanna Pattanayak holds a masters degree in finance from NIILM centre for management studies. His professional career spans over 10 years into industry and academics. He has more than six years of experience in teaching, training and research. His teaching interests include areas like Economics, Agribusiness and Business Environment. Along with facilitating courses, he […]

Working as an Associate Professor (Finance) in the School of Management, Centurion University, and Management, Bhubaneswar. Completed MBA from Kanchipuram University in 1998 with specialization in Finance and done Ph.D. entitled “The Impact of Inflation on Business Performance under Conditions of Limited Financial Disclosure: Case of Firms Operating in India”. Have 15 years of teaching […]