ACCT 205 Managerial Accounting Course Guide

Course Description

ACCT 205 Accounting II is the study of Managerial Accounting.  As the second half of the accounting introductory course for business majors, it continues to emphasize the role of accounting in management decision making.  Topics such as Activity Based Costing and Management (ABC & ABM), cost behavior and classification, cost volume profit analysis, short term decision making, budgeting, performance measurement, and cost control are included. 

Specific, Assessable Learning Outcomes

The student will be able to:

1. Understand the difference between managerial (internal) and Financial (external) accounting.
2. Extract the relevant information from financial statements in order to analyze and provide information for decision making.
3. Explain the concepts of Cost Behavior, Cost Volume Profit Analysis, and Short-term Decision Making, as utilized in management decisions.
4. Define the difference between qualitative and quantitative characteristics of information in the use of information in making decisions.
5. Explain the use of Budgeting, Activity-Based Costing and Management, Cost Control, and Performance Measurement as management planning and decision tools.
6. Explain the different costs that are included by management when pricing a good or service.
7. Construct a basic budgeted Income statement.
8. Use a basic understanding about accounting and financial information for organizational decision-making.
9. Recognize the ethical and/or behavioral implications inherent in utilizing cost information in managerial decision making. 

Recommended Teaching Methodology 

Faculty teaching the course are expected to utilize a variety of teaching styles and evaluation mechanisms throughout the semester.   Assessment of written and/or communication skills is encouraged.   There will be the equivalent of at least one class (or cases) addressing the behavioral and ethical considerations inherent in the collection, analysis, and use of information for management decision making.

Course Outline

Cost Volume Profit Analysis    
Mixed Costs         
Regression Analysis               
Activity Based Costing 
Short-term Decision Making 

Budgeting 

Control and Performance Evaluation            
Ethical and Behavioral Implications         
Responsibility Accounting          
ROI & RI Analysis               
Cost of Quality 

Evaluation of Standard Cost Variances              
Direct Material     
Direct Labor         
Variable Overhead 

Ethical Considerations in Management Decision Making 

Basic Cost Flows associated with the cost of a product or service (The level of detail will be dependent upon Instructor Emphasis.) 

Other issues dependent upon Time and Instructor Emphasis              
E.g.     Balanced Scorecard             
Strategic Planning 

Recommended Assessment Measures

The faculty teaching the course will utilize the same textbook and will participate in a common final examination that will including common multiple-choice questions that can be used for comparison over time.  These questions have been developed and are being evaluated to assure that they are testing the appropriate material.  The agreed upon questions will be used on all final exams include covering the following material:

1. Short-term Decision Making  (e.g. Special Orders)
2. Cost Allocation
3. Budgeting
4. Variance Investigation
5. Regression Analysis
6. Relevant costs for Decision Making ( e.g. dropping  a business segment)
7. Cost of Quality
8. Cost-Volume-Profit Analysis
9. Performance Evaluation  (e.g. Residual Income)

During the semester, there will be a comprehensive Budgeting Assignment that will assess the use and understanding of spreadsheet programs (such as excel).  Each instructor will develop an assignment.  The development of shared assignments and assessment methodologies will be encouraged. 

Statement of Expectations

This course is a required core course for all majors and minors in the School of Business.

The students will be expected to show an interest  in the subject, the willingness to commit the necessary resources in terms of time and intellectual effort, and the willingness to actively participate in the skill development process. 

The knowledge expected to be gained from this course is important throughout the student’s career.  Most of the learning that will take place will not occur in the classroom.  It will occur while working on the material outside of class – when reading, thinking critically, analyzing, and applying the concepts to real problems.  The amount learned and the level of skill developed will be directly proportional to the amount of effort put forth in preparing for class. 

The classes are opportunities to discuss and apply the material, to develop communication ability, and to create leadership skills.  There are opportunities for the faculty member to provide insight, to help when appropriate, and to evaluate performance.  Like any athletic or artistic endeavor, most of the knowledge acquisition and skill development takes place when practicing, not performing.

Prerequisite Knowledge 

ACCT 200.  Specifically, students must thoroughly understand economic transactions, the construction of basic financial statements, and the interrelationships that exist among the basic financial statements. 

Students must have an understanding of business statistics (including basic regression analysis and concepts).  The statistics course may be taken prior to or concurrent with ACCT 205. 

A student is expected to possess a working knowledge of spreadsheets, as well as the ability to use quantitative manipulation of information within a decision-making context.  An ability to make an oral presentation and the ability to write about and research business topics is also expected. 

Students entering ACCT 205 are expected to be at least Sophomore level students as such prior background in information literacy will be continued by the expectation that students can and will obtain information about companies from the library and internet. 

Institutional Mechanism for Providing Feedback for Continuous Quality Improvement

The Accounting Department periodically reviews the analysis of the final exam questions.  Accordingly,  changes to the questions and the course are made following this review.  The faculty teaching the course are provided with data annually about the performance of their students on these exam questions. 

Calculators

The Accounting Department policy regarding programmable calculators requires students in ACCT 205 to bring a simple four-function calculator to use on exams rather than their TI-83s in order to reduce the likelihood of cheating.  

What follows explains the steps that need to be followed to clear the entire memory on a TI-83 and a method of doing that prior to exams. This approach is equally acceptable to the requirement of a substitute calculator, i.e. faculty in the first two courses may choose to do either.  

Here's how to run it on the TI-83 Plus (anything in brackets is a button on the calculator). 

You hit [2nd],[+],[7], then scroll over to the right twice to get to the "ALL" menu.
Then hit [1], [2]. 

The calculator will respond by wiping itself clean, and a message pops up at the end of this routine that says "Mem cleared" (If the student runs the wrong routine, it pops up with "RAM cleared” and any archived information is still in calculator memory).