Strategic Cost Management Book Third Sem MBA VTU

Syllabus

Course Code: 22MBAFM303

Strategic Cost Management

Module 1                                                                                                            (8 Hours)

Introduction to Cost Management- Cost Accounting to Cost Management- Elements of Costs- Classification of Costs-Methods of Costing-Cost Management Tools- A Strategic View to Cost Management- Preparation of a Cost Sheet. (Problems on Cost Sheet).

Module 2                                                                                                            (8 Hours)

Overheads: Classification and Collection, Difference between Cost Allocation and Cost Apportionment, (Full-Fledged Problems on Primary and Secondary Distribution, Simultaneous Equations, Absorption of Overhead, Theory on Under and Over Absorption of Overhead). Demerits of Traditional Costing, Activity Based Costing, Cost Drivers, Cost Analysis Under ABC (Unit Level, Batch Level and Product Sustaining Activities), Benefits and Weaknesses of ABC. (Theory & Problems).

Module 3                                                                                                            (9 Hours)

Marginal Costing – Nature and Scope- Applications-Break Even Charts and Point, Decision-making (All Types with Full Problems) Differential Cost Analysis, Advantages and Disadvantages of Marginal Costing Process Costing: Introduction to Process Costing, Cost Accumulation in Process Costing (Problems).

Module 4                                                                                                            (9 Hours)

Budgetary Control- Objectives of Budgetary Control, Functional Budgets, Master Budgets, Key Factor Problems on Production Budgets and Flexible Budgets. Standard Costing:- Comparison with Budgetary Control, Analysis of Variances, Simple Problems on Material and Labour Variances Only (Problems).

Module 5                                                                                                            (9 Hours)

Cost Audit & Reporting to Management-Objectives and Advantages of Cost Audit, Cost Audit Report. Management Audit- Objectives and Scope. Reporting to Management – Purpose of Reporting- Requisites of a Good Report, Classifications of Report, Segment Reporting, Cost Reduction and Cost Control, Target Costing – its Principles, Balanced Scorecard: Features and Purpose (Theory Only).

Module 6                                                                                                            (7 Hours)

Responsibility Centers: Revenue and Expense Centers Responsibility Centers, Revenue Centers. Transfer Pricing – Meaning, Principles of Transfer Pricing, Methods of Transfer of Pricing Expense Centers, Administrative Centers. Cost Management for Specific Sectors – Gold, Agriculture, IT Sector, Phrama and Others (Theory Only).