Accounting for Decision Making - MB25101

MB25101:

Accounting for Decision Making

Course Objectives:

This course equips a comprehensive understanding of financial, cost, and management accounting principles. It emphasizes the analysis and interpretation of financial statements to support informed decision-making. Through practical exposure to accounting techniques such as ratio analysis, costing methods, marginal costing, and budgeting.

Introduction to Financial Accounting and Reporting: Introduction to Financial, Cost and Management Accounting, Generally accepted accounting principles– Double Entry System, Preparation of Journal, Ledger and Trial Balance Preparation of Final Accounts: Trading, Profit and Loss Account and Balance Sheet (Problem) - Reading the financial statements

Financial Statement Analysis: Financial ratio analysis (Problem), Interpretation of ratio for financial decisions- Dupont Ratios, Comparative statements - common size statements. Cash flow (as per Accounting Standard 3) and Funds flow statement analysis (Problem), Trend Analysis.

Cost Accounting Systems: Cost Accounts, Classification of costs, Job cost sheet, Job order costing, Process costing, (excluding Interdepartmental Transfers and equivalent production), Joint and By Product Costing, Activity Based Costing, Target Costing.

Marginal Costing and Decision-Making: Marginal Costing and profit planning, Cost, Volume, Profit Analysis, Break Even Analysis, Decision making problems -Make or Buy decisions - Determination of sales mix (Problem) - Exploring new markets, Add or drop products -Expand or contract.

Budgeting and Performance Management: Budgetary Control, Sales, Production, Cash flow, fixed and flexible budget (Problem), Standard costing and Variance Analysis, (excluding overhead costing) -Accounting standards and accounting disclosure practices in India.

Accounting Standards and Strategic Applications: Accounting standards and disclosures in India, Overview of IFRS and convergence, Ethical issues in accounting, Financial statement fraud detection, Use of accounting in strategic Business decision-making, Role of analytics in finance and accounting..

Weightage: Continuous Assessment: 40%, End Semester Examinations: 60%.

Assessment Methodology: Written Test I & II (60%) Assignment, Presentation, Case Study, Quiz, Simulation, Online Certification, Seminar, Mini project (40%)

References:

1. Narayanaswamy, R. (2022). Financial accounting (7th ed.). PHI.

2.  Khan, M. Y., & Jain, P. K. (2021). Management accounting (8th ed.). Tata McGraw Hill.

3. Singhvi, N. M., & Bodhanwala, R. J. (2018). Management accounting, Text and cases (3rd ed.). PHI.

4. Stice, E. K., & Stice, J. D. (2024). Financial accounting, reporting & analysis (9th ed.). Cengage.

5. Bhattacharya, A. K. (2012). Introduction to financial statement analysis. Elsevier/PHI.

6. Reddy, T. S., & Murthy, A. (2024). Financial accounting (latest ed.). Margham Publications.