Managerial Accounting

⏱️Managerial Accounting

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Unit 1 – Accounting as a Tool for Managers

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1.1

Define Managerial Accounting and Identify the Three Primary Responsibilities of Management

3 min read

1.2

Distinguish between Financial and Managerial Accounting

2 min read

1.3

Explain the Primary Roles and Skills Required of Managerial Accountants

4 min read

1.4

Describe the Role of the Institute of Management Accountants and the Use of Ethical Standards

3 min read

1.5

Describe Trends in Today’s Business Environment and Analyze Their Impact on Accounting

4 min read

Unit 2 – Managerial Accounting Fundamentals

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2.1

Distinguish between Merchandising, Manufacturing, and Service Organizations

3 min read

2.2

Identify and Apply Basic Cost Behavior Patterns

3 min read

2.3

Estimate a Variable and Fixed Cost Equation and Predict Future Costs

3 min read

Unit 3 – Cost–Volume–Profit Analysis

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3.1

Explain Contribution Margin and Calculate Contribution Margin per Unit, Contribution Margin Ratio, and Total Contribution Margin

2 min read

3.2

Calculate a Break-Even Point in Units and Dollars

3 min read

3.3

Perform Break-Even Sensitivity Analysis for a Single Product Under Changing Business Situations

4 min read

3.4

Perform Break-Even Sensitivity Analysis for a Multi-Product Environment Under Changing Business Situations

4 min read

3.5

Calculate and Interpret a Company’s Margin of Safety and Operating Leverage

3 min read

Unit 4 – Job Order Costing

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4.1

Distinguish between Job Order Costing and Process Costing

2 min read

4.2

Describe and Identify the Three Major Components of Product Costs under Job Order Costing

3 min read

4.3

Use the Job Order Costing Method to Trace the Flow of Product Costs through the Inventory Accounts

3 min read

4.4

Compute a Predetermined Overhead Rate and Apply Overhead to Production

2 min read

4.5

Compute the Cost of a Job Using Job Order Costing

3 min read

4.6

Determine and Dispose of Underapplied or Overapplied Overhead

2 min read

4.7

Prepare Journal Entries for a Job Order Cost System

3 min read

4.8

Explain How a Job Order Cost System Applies to a Nonmanufacturing Environment

3 min read

Unit 5 – Process Costing

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5.1

Compare and Contrast Job Order Costing and Process Costing

3 min read

5.2

Explain and Identify Conversion Costs

3 min read

5.3

Explain and Compute Equivalent Units and Total Cost of Production in an Initial Processing Stage

3 min read

5.4

Explain and Compute Equivalent Units and Total Cost of Production in a Subsequent Processing Stage

3 min read

5.5

Prepare Journal Entries for a Process Costing System

3 min read

Unit 6 – Activity-Based and Absorption Costing Methods

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6.1

Calculate Predetermined Overhead and Total Cost under the Traditional Allocation Method

2 min read

6.2

Describe and Identify Cost Drivers

3 min read

6.3

Calculate Activity-Based Product Costs

4 min read

6.4

Compare and Contrast Traditional and Activity-Based Costing Systems

3 min read

6.5

Compare and Contrast Variable and Absorption Costing

3 min read

Unit 7 – Budgeting

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7.1

Describe How and Why Managers Use Budgets

3 min read

7.2

Prepare Operating Budgets

4 min read

7.3

Prepare Financial Budgets

3 min read

7.4

Prepare Flexible Budgets

3 min read

7.5

Explain How Budgets Are Used to Evaluate Goals

2 min read

Unit 8 – Standard Costs and Variances

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8.1

Explain How and Why a Standard Cost Is Developed

3 min read

8.2

Compute and Evaluate Materials Variances

4 min read

8.3

Compute and Evaluate Labor Variances

3 min read

8.4

Compute and Evaluate Overhead Variances

3 min read

8.5

Describe How Companies Use Variance Analysis

3 min read

Unit 9 – Responsibility Accounting & Decentralization

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9.1

Differentiate between Centralized and Decentralized Management

3 min read

9.2

Describe How Decision-Making Differs between Centralized and Decentralized Environments

3 min read

9.3

Describe the Types of Responsibility Centers

4 min read

9.4

Describe the Effects of Various Decisions on Performance Evaluation of Responsibility Centers

3 min read

Unit 10 – Short–Term Decision Making

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10.1

Identify Relevant Information for Decision-Making

2 min read

10.2

Evaluate and Determine Whether to Accept or Reject a Special Order

3 min read

10.3

Evaluate and Determine Whether to Make or Buy a Component

3 min read

10.4

Evaluate and Determine Whether to Keep or Discontinue a Segment or Product

2 min read

10.5

Evaluate and Determine Whether to Sell or Process Further

3 min read

10.6

Evaluate and Determine How to Make Decisions When Resources Are Constrained

3 min read

Unit 11 – Capital Budgeting Decisions

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11.1

Describe Capital Investment Decisions and How They Are Applied

3 min read

11.2

Evaluate the Payback and Accounting Rate of Return in Capital Investment Decisions

3 min read

11.3

Explain the Time Value of Money and Calculate Present and Future Values of Lump Sums and Annuities

4 min read

11.4

Use Discounted Cash Flow Models to Make Capital Investment Decisions

3 min read

11.5

Compare and Contrast Non-Time Value-Based Methods and Time Value-Based Methods in Capital Investment Decisions

4 min read

Unit 12 – Balanced Scorecard & Performance Metrics

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12.1

Explain the Importance of Performance Measurement

3 min read

12.2

Identify the Characteristics of an Effective Performance Measure

3 min read

12.3

Evaluate an Operating Segment or a Project Using Return on Investment, Residual Income, and Economic Value Added

5 min read

12.4

Describe the Balanced Scorecard and Explain How It Is Used

4 min read

Unit 13 – Sustainability Reporting

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13.1

Describe Sustainability and the Way It Creates Business Value

3 min read

13.2

Identify User Needs for Information

3 min read

13.3

Discuss Examples of Major Sustainability Initiatives

3 min read

13.4

Future Issues in Sustainability

3 min read

What do you learn in Managerial Accounting

Managerial Accounting focuses on using financial data to make business decisions. You'll learn how to analyze costs, create budgets, and evaluate performance. The course covers topics like cost-volume-profit analysis, job costing, activity-based costing, and variance analysis. You'll also get into pricing strategies, capital budgeting, and how to use accounting info for planning and control.

Is Managerial Accounting hard?

Managerial Accounting can be challenging, especially if you're not a numbers person. It involves a lot of calculations and critical thinking. The concepts aren't too complicated, but applying them to real-world scenarios can be tricky. Many students find it harder than financial accounting because it's more about analysis and decision-making rather than just recording transactions.

Tips for taking Managerial Accounting in college

  1. Use Fiveable Study Guides to help you cram 🌶️
  2. Practice, practice, practice! Do as many problem sets as you can
  3. Focus on understanding concepts, not just memorizing formulas
  4. Create visual aids like flowcharts for complex processes (e.g., job costing steps)
  5. Form study groups to discuss real-world applications of concepts
  6. Stay on top of homework - the material builds on itself
  7. Use Excel for calculations and to create visual representations of data
  8. Watch YouTube videos explaining tough concepts (like activity-based costing)
  9. Read business news to see how companies apply managerial accounting in real life

Movie suggestion: "The Accountant" (2016) - while not strictly about managerial accounting, it shows how accounting skills can be applied in various situations.

Common pre-requisites for Managerial Accounting

  1. Financial Accounting: This course introduces the basics of accounting principles and financial statements. You'll learn how to record transactions and prepare balance sheets, income statements, and cash flow statements.

  2. Introduction to Business: This class provides an overview of how businesses operate and the various functional areas within an organization. It covers basic concepts in management, marketing, finance, and operations.

Classes similar to Managerial Accounting

  1. Cost Accounting: This course dives deeper into cost analysis and control techniques. It focuses on how to determine the cost of products or services and use that information for decision-making.

  2. Financial Management: This class explores how to make financial decisions in a business context. It covers topics like capital budgeting, risk assessment, and financial planning.

  3. Operations Management: This course looks at how to manage the production of goods and services efficiently. It includes topics like supply chain management, quality control, and process improvement.

  4. Business Analytics: This class teaches you how to use data to make better business decisions. It covers statistical analysis, data visualization, and predictive modeling techniques.

  1. Accounting: Focuses on preparing and analyzing financial information for businesses. Students learn about financial reporting, auditing, tax planning, and managerial accounting.

  2. Finance: Deals with managing money and investments for individuals and organizations. Students study financial markets, investment strategies, and corporate financial management.

  3. Business Administration: Provides a broad understanding of how businesses operate. Students learn about management, marketing, finance, and operations, preparing them for various business roles.

  4. Economics: Examines how societies allocate resources and make decisions. Students study micro and macroeconomics, economic policy, and how businesses operate within economic systems.

What can you do with a degree in Managerial Accounting?

  1. Management Accountant: Prepares financial reports and analyzes data to help managers make decisions. They often work on budgeting, performance evaluation, and cost management.

  2. Financial Analyst: Evaluates investment opportunities and provides financial guidance to businesses. They analyze financial data, create financial models, and make recommendations based on their findings.

  3. Budget Analyst: Helps organizations plan their finances and monitor spending. They review budget proposals, analyze data, and make recommendations to ensure efficient use of resources.

  4. Operations Manager: Oversees the day-to-day operations of a business or department. They use managerial accounting principles to analyze costs, improve efficiency, and make strategic decisions.

Managerial Accounting FAQs

  1. How is managerial accounting different from financial accounting? Managerial accounting focuses on internal decision-making, while financial accounting is geared towards external reporting. Managerial accounting is more forward-looking and doesn't have to follow strict rules like GAAP.

  2. Do I need to be good at math for this course? Basic math skills are important, but it's more about understanding concepts and applying them. You'll use a lot of addition, subtraction, multiplication, and division, but complex math isn't typically required.

  3. Can I use a calculator during exams? Most professors allow calculators during exams, but check with your instructor. Some may restrict certain types of calculators or require you to show your work.

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About FiveableBlogCareersTestimonialsCode of ConductTerms of UsePrivacy PolicyCCPA Privacy Policy
Resources
Cram ModeAP Score CalculatorsStudy GuidesPractice QuizzesGlossaryCrisis Text LineRequest a Feature
© 2024 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.
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