Subject name

Cost Analysis for Decision Making
Study
Master in Business Administration
ECTS
3
Four-month period
First four-month period, first module
Type of subject Compulsory

Presentation

It is virtually impossible for managers to function without information. Information is vital for the management process, and accounting is one of the major information systems within any organisation. Managerial accounting studies the generation, communication, and interpretation of internal information, both financial and non-financial. A sound understanding of managerial accounting is absolutely necessary for managers to fulfil their organisational roles, responsibly and competently.  
Cost accounting provides key data to managers for planning and controlling as well as costing products, services and customers. The main focus of this course is how cost accounting can help managers to both operational and strategic decision-making

The management process includes the following main activities: (1) planning, (2) decision-making, and (3) controlling. Costs play a big role in all those activities and therefore a thorough understanding of the different costs present in an organization and how information about costs can help making better decisions is a key competence managers must have.

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Competences

General Competences

  • GC1. To control and to integrate the techniques, instruments and methods of management needed in the development of the professional activity.
  • GC2. To delve into the business management and into the different administration areas.
  • GC4. That the students can communicate their conclusions, present their projects, results, plans, the knowledge and the reasons that support them before a specialized or an ordinary public in a clear and in an ambiguity free manner.
  • GC5. That the students are able to integrate their knowledge in the different working areas of the business with information, usually incomplete or limited, in the business environment in order to manage the decision making and troubleshooting processes through complex and multidisciplinary situations.

Basic Competences

  • BC6. To have and to understand the knowledge that will provide a base or the opportunity of being original in the development and/or in the application of an idea, often in an investigating context.
  • BC7. That the students can apply the acquired knowledge and their troubleshooting skills in new or barely known environments within the widest context (or multidisciplinary context) related to their area of study.
  • BC8. That the students are capable to integrate the knowledge and to face the complexity of judging from the information that, being incomplete or limited, includes reflections on the social and ethical responsibilities bounded to the application of their own knowledge and judgements.
  • BC9. That the students can communicate their own conclusions, knowledge and reasoning of the same before a specialized or an ordinary public in a clear and in an ambiguity free manner.
  • BC10. That the students have the learning skills that will allow them to continue in their studies in a self-guided or autonomous manner most of the time.

Specífic Competences

  • SC5. Learning to manage the managing indicator in the business decision-making depending on the same.
  • SC12. To understand the functional organization of the business. Areas interrelation. To identify and to understand the factors and dimensions that belongs to the functional part of the business, and the features of its administration system.
  • SC20. Ability of business decision-making according to the information of the analysis and interpretation on the four business fundamental accounting concepts: Balance sheets, Profit and Loss accounts, Cash Flow statement and Net Worth statement and of the main ratios and indicators of business and finance management.
  • SC21. To understand fixed and current assets funding, the project funding and the self-generated funds of products or business areas.
  • SC22. To be able to relate the business management decision-making with the macroeconomic changes.

Transversal Competences

  • TC6. To communicate efficiently, in a structured and organised manner, the most relevant aspects of a project.
  • TC8. To ease the process of transition to the business professional career.
  • TC9. To provide the students with learning skills that will allow them to continue their studies in an autonomous manner.

Program

Unit 1. Introduction
Introduction
Cost accounting, decision making and control
The accountant role in an organization
The role of ethics in cost accounting
Master class

Unit 2. Costs
Introduction to costs concepts
Product and period costs
Direct and indirect costs
Variable and fixed costs
Sunk costs
Opportunity costs
Practice exercise

Unit 3. Cost- Volume - Profit Analysis
Introduction to CVP analysis
Contribution margin
Breakeven point and target income
Operating Leverage
CVP analysis for decision making
Sensitive analysis
Master class

Unit 4. Costing Systems
Introduction
Actual costing and normal costing
Job costing
Activity based costing
Process costing
Master class

Unit 5. Budgeting and Variance Analysis
Introduction
Operating budget
Variance analysis
Master class

Unit 6. Relevant Costs
Introduction
Decision making and relevant information
Make or buy decisions
Special order decisions
Product mix decisions
Master class

 

Methodology

Metodología

The different tasks and activities programmed during the semester have been developed with the goal of adapting the learning process to the different capabilities, necessities and interests of the students.

The activities included in the subject are:

  • Practical cases: will provide the student with actual business situations that will need to analyse and, after that, make decisions, evaluate the consequences and alternatives. They will allow acquiring intellectual skills to face sudden situations or to plan action programs adapted to a changing environment where there is no math logic.
  • Participation in events. During the course you will be participating in different events. Some of those events are attendance to online classes, forums, self-evaluation tests.

In the weekly program you can find the specific tasks you need to complete in this subject.

Descarga el pdf de la programación

These activities are combined with the following aspects:

  • Personal Study
  • Tutoring. The tutoring class can be implemented through different tools and means. During the course of the subject, the teacher-tutor plans the individual tutoring on specific days for the resolution of academic-oriented doubts through “Consultation sessions”. Supplementing these sessions, students have also available the “Ask your teacher” forum through which they can formulate questions and check the corresponding answers on general aspects of the subject.  Due to the very nature of the media used, there are no fixed schedules for the students.
  • Mandatory on-site final exam

The hours dedicated to each activity are detailed as follows:

Assignments
Hours
Assistance to virtual classes       9,0  
Basic material study     22,0
Additional resources readings       4,0  
Task and practice cases       9,0  
Self-evaluation test      18,0  
Individual and group tutoring      18,0  
Collaborative work, forums, debates, etc.       9,0  
Master's Dissertation work development           -    
Final evaluation           -    
Total
        90  

 

You can personalize your study plan choosing the type of activity that best matches your profile. The tutor will advise you and help you elaborate your study plan. S/he will always be available to guide throughout the course..

Bibliography

Basic bibliography

The section Basic Bibliography is essential for the course. If any document (reading, article,…) is not available in the virtual classroom, you will have to find it by other means: UNIR bookshop, virtual library…

Unit 1

  • Zimmerman, J.L. (2010). Accounting for decision making and control. 7th Ed. New York: MacGraw Hill–Irwin.

Available at the virtual campus under the art. 32.4 of the Spanish Intellectual Property Law*.

Unit 3

  • Bierman, Dyckman & Hilton (1990). Cost Accounting: Concepts and Managerial Applications. Boston: Kent-PWS.

Available at the virtual campus under the art. 32.4 of the Spanish Intellectual Property Law*.

Unit 4

  • Horngren, C.T., Datar, S.M. & Foster, G. (2005). Cost Accounting: A Managerial Emphasis. Pearson Prentice Hall.

Available at the virtual campus under the art. 32.4 of the Spanish Intellectual Property Law*.

Unit 5
  • Horngren, C.T., Datar, S.M. & Rajan, M.V. (2012). Cost Accounting: a managerial emphasis. Pearson Education Limited.

Available at the virtual campus under the art. 32.4 of the Spanish Intellectual Property Law*.

Unit 6

  • Horngren, C.T., Datar, S.M. & Foster, G. (2005). Cost Accounting: A Managerial Emphasis. Pearson Prentice Hall.
Available at the virtual campus under the art. 32.4 of the Spanish Intellectual Property Law*.

 

* This work is protected by copyright and its reproduction and public communication, in the available modality, is authorized under the art. 32.4 of the Spanish Intellectual Property Law. It is forbidden its subsequent reproduction, distribution and public communication in any form or by any means, except one printed reproduction by each authorized user.

 

evaluación

Evaluation and Assessment

The evaluation system is based on the following numerical chart:

0 - 4.9

Suspenso (D)

(SS)

5.0 - 6.9

Aprobado (C)

(AP)

7.0 - 8.9

Notable (B)

(NT)

9.0 - 10

Sobresaliente (A)

(SB)

The grade is made up of two components:

calificación

On-site final exam (60%). At the end of the semester, you need to assist a mandatory on-site final exam. You need to pass the final exam so the grade obtained from the assignments (continuous assessment) is summed up to the final grade of the subject. 

Continuous assessment (40%): this type of assessment will be measured through the different assignments you need to complete during the course:

    • Active participation and involvement in forums, online classes.
    • Tasks. The completion of the different activities the students need to send through our virtual classroom such as research, critical thinking, practice cases.
    • Self-evaluation tests. At the end of each unit, students will find a short quiz which will help the students to check the knowledge acquired during the course.

Remember that you can check the points (value) of each assignment in the weekly program.

Take into account that the sum of the grades of the assignments included in the continuous assessment is 6 points. You can fulfil as many as you want to a maximun of 4 points (which is the max. grade that you could acomplish in the continuous assessment). In the weekly program, you can find the grade of each assignment.

Assessment method

Min. Score

Max. Score

Participation in forums, classes, etc.

0%

15%

Task, practice cases and activities

0%

15%

Additional readings

0%

10%

On-site final exam

0%

60%

 

Bear in mind…
That if you decide to only take the final exam, you will need to have 5 points out of 6 to pass the subject. .

Professor

Dr. Garen B. Markarian

Education: Dr. Markarian has 15yrs+ experience in management education at the undergraduate, masters, executive, and Ph.D. level. He currently is the academic co-director of the Venture Capital and Private Equity executive education program, and the co-director of the WHU risk management program partnered with the Stockholm School of Economics. Dr. Markarian has earned a B.S. in biology from American University of Beirut, and a Ph.D. from the Weatherhead School of Management at Case Western Reserve University.

Professional experience: Garen Markarian holds the chair of financial accounting at WHU - Otto Beisheim School of Management. As an international scholar specializing in corporate finance and governance, he has taught at IE Business School (Madrid), HEC (Paris), Bocconi, (Milan), Concordia (Montreal), Rice (Houston), and Case Western Reserve (Cleveland). He has previously held the position of First Regional Economic Officer for Western Asia at the United Nations.

Lines of research: Dr. Markarian has extensive experience in research on governance mechanisms, executive compensation, the banking crisis, stock markets, and financial statements and valuation.

Juan Francisco Prados

Education: Juan Francisco Prados is specialized in Financial Management and Leadership and has earned a Executive Master in Innovation and an Executive MBA at the ESIC Business & Marketing School.

Professional experience: Being a highly experienced professional in the field of Financial Management and Project Manager, he is currently working as a Freelance Professional. He has almost 15 years of experience working for different companies internationally and developing projects for a wide diversity of economic sectors: tourism, commerce, industry and services.

Lines of research: Financial Leadership, Project Management, Business Consulting, TIC Strategy, e-Learning.

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Tips

Orientación para el estudio

Studying online means you can organize your study as you wish, as long as you meet the due dates of the different assignments (activities, tasks and tests). In order to help you, we propose the following steps:

  1. From our online platform you will have access to each of the subjects you are enrolled. Apart from this, you can access to the virtual classroom of the master. In this section, you have available all the documents on how to use the different tools included in the virtual classroom, how a subject is organized and you will also have the possibility to organize your study plan with the tutor. n this section, you have available all the documents on how to use the different tools included in the virtual classroom, how a subject is organized and you will also have the possibility to organize your study plan with the tutor.
  2. Do not forget to check the weekly program. You will see which part of the content of the course you have to work on every week.
  3. After knowing your work for the week, go to Units in your virtual classroom. There, you will have access to the study material (theory and practice) from the unit you need to study throughout the week.
  4. Start by reading thethe Basic Knowledge of the unit, this section is the basic study material of the unit. Always read the first part of the same, Introduction, as we will show you here all the material you need to study. Visit, as well, the Resources section, you will find here the complementary readings, videos, experiences, etc.
  5. Devote some time when doing the Practical Cases and Test. In the subject Program we will detail which are the corresponding activities for each week and the max. grade you can achieve in each one.
  6. We strongly recommend to take part in the events of the course (On-site virtual classes, debate forums, etc.). To know the exact date for each one of these events you must visit the communication media on the Virtual Classroom. Your teacher and your tutor will inform of the subjects news.
In the Virtual Classroom of the master you will always find available the documentation where we explain how the units are structured and what you will be able to find in each one of its sections: Basic Knowledge, Practical Cases, Experiences, Readings, More Resources and Test.

Remember that in the virtual classroom of the master you can check how the different tools of the virtual classroom work: email, forum, online classes, sending the tasks, etc.

Please, take into account the following tips…

  • Whatever you study plan is, go often to the virtual classroom so that you are always up to date about the course and you are in contact with your teacher and your tutor.
  • Remember you are not alone: send an email to your tutor if you have any doubt. If you attend the online classes, you can also ask your teacher about the contents of the unit. Also, you can always write your doubts and questions about  the contents in the Forum of each subject (Ask the teacher).
  • Be active and participate!  Whenever it is possible, attend the online classes and take part in the forums. The exchange of information, opinions, ideas and resources enrich us and the course.
  • And, remember, you are studying online: your effort and perseverance are the key element to obtain good results. Don’t leave everything to the last minute!!!