COST MANAGEMENT ACCOUNTANT (CMA) SYLLABUS

Professional Level 1
Subject: Cost Accounting (102)
Course Objectives: To provide the students with an in-depth knowledge of Cost Accounting concepts, principles and methods to develop ability and skills to prepare and analyses Cost Accounting data to meet the requirements of different manufacturing concerns. On completion of this course they will be able to: a. discuss the role of cost accounting and quantitative analysis within the organization. b. apply the principles relating to the costing and control of the different resource inputs into the business. c. demonstrate costing methods and techniques appropriate to a variety of different business.

Chapter 1: Introduction to Cost Accounting Definition of Cost Accounting, Comparison of Cost Accounting and Financial Accounting; The role of Cost Accounting; Cost Data for Management Purposes; Methods and Techniques of Cost Accounting; Characteristics of an Ideal Cost Accounting System; Installation of a Cost Accounting System; Modern Trends in Cost Accounting. Chapter 2: Cost Concepts, Classifications and Statements Cost Object; Expenditures, Cost, Expense and Loss; Cost Classifications; Cost Data and Uses; The Chart of Accounts; Statement of Cost of Goods Manufactured and Sold; Income Statement. Chapter 3: Costing and Control of Materials Classification of Materials; Accounting for Materials; Pricing the Issue of Materials Valuation of Inventory; Periodic Inventory System and Perpetual Inventory System; Inventory Planning; Ordering Cost, Holding Cost and EOQ; Effect of Quantity Discounts on EOQ; Safety Stock and Reorder Point; Material Control Methods; Impact of JIT on Inventory Accounting; Materials Requirement Planning System.

Chapter 4: Costing and Control of Labor Productivity and Labor Costs; Costs included in Labor; Accounting for Labor; Time Keeping, Computation of total payroll and Allocation of Payroll costs; Journalizing Labor Costs; Special Problems Relating to Accounting for Labor; Labor cost Control, Labor Turnover and Control of Labor Turnover; Learning Curve Theory. Chapter 5: Costing and Control of Manufacturing Overhead Manufacturing Overhead Costs; Actual Vs. Normal Costing of Manufacturing Overhead; Production Capacity, Predetermined Overhead Rates; Departmental vs. Plant-wise Overhead Rates; Separating Mixed Costs. Scatter-graph; High-low Method and Regression Analysis; Accounting for Manufacturing Overhead; Analysis and Disposition of Under-applied-and Over-applied Overhead. Chapter 6: Service Department Costs Allocation Service department costs; Volume based costing; Need for cost allocation; Guidelines for cost allocation; Plant-wise rate vs. departmental rates; Cost allocation methods; Direct method; Step method; Reciprocal method and linear algebra method; Single and dual rate methods; Determination of costs should be allocated-budgeted or actual. Chapter 7: Activity-Based Costing (ABC) The Contemporary Manufacturing Environment; Limitation of Traditional Costing Systems; ABC Defined; Identifying Activities that Use Resources; Cost Drivers and Choosing Cost Drivers; Assigning Costs Using Activity-Based Costing-Benefits of ABC; Criticism of ABC; ABC and strategic Cost Management. Chapter 8: Cost Accumulation System Objective of Cost Accumulation; Cost Accumulation Periodic vs. Perpetual; Cost Accumulation-Actual vs. Standard; Periodic a Perpetual Cost Accounting System; the Factory Ledger. Chapter 9: Job Order Cost System Job Order Costing; Job Order Cost System-Illustrated; Spoiled Goods; Defective Goods; Scrap materials and Waste Materials in a Job order Cost System. Chapter 10: The Nature and Characteristics of process Cost System Process Costing Defined; Objective of Process Cost System; Characteristics of a Process Cost System; Comparison of Job Order and Process Cost Accumulation System; Production by Department; System Flow; Determination of Equivalent Units; The Cost of Production Report.

Tex Books 1. Cost Accounting Ralph S. Polimeni, Frank Fabozzi & Arthur H. Adelherg (3rd ed). 2. Cost Accounting F. Usry & H. Hammer (13th edition). Reference Books 3. Cost Accounting L. Gayle Rayburn (6th edition). 4. Cost Management Blocher, Chen & Lin (1st edition). 5. Cost Accounting C. T. Horngren & Others (11th edition).