9CP61 - ELEMENTS OF MANAGEMENT ACCOUNTING (EMA) 6TH SEM DIPLOMA IN COMMERCIAL PRACTICE

GOVERNMENT OF KARNATAKA

DEPARTMENT OF TECHNICAL EDUCATION

BOARD OF TECHNICAL EXAMINATIONS

DIPLOMA IN COMMERCIAL PRACTICE

VI SEMESTER SYLLABUS

9CP61 - ELEMENTS OF MANAGEMENT ACCOUNTING (EMA)

 

      Contact Hours per week = 5                                                Contact Hours per Semester = 80                             

 

1.      INTRODUCTION AND OVERVEIW OF MANAGEMENT ACCOUNTING:

Meaning – Functions – Objectives – Advantages – Limitations – Scope of Management Accounting – Installation of Management Accounting System – Tools of Management Accounting – Management Accounting versus Financial Accounting.

2.      RATIO ANALYSIS:

Meaning of Ratio -  Objectives -  Merits – Limitations of Ratio Analysis – Interested Parties in Ratio Analysis – Classifications of Ratios – Simple Problems on Calculation and Interpretation of Balance Sheet Ratios (Financial Ratios) Revenue Statement Ratios (Profitability Ratios or Operating Ratios) Activity Ratios ( Turnover Ratios or Velocity Ratios). 

3.      FUNDS FLOW ANALYSIS:

Meaning of Fund, Flow of Fund and Funds Flow Statement – Importance of Funds Flow Statement (Analysis) – Uses and Limitations of Funds Flow Statement – Parties Interested in Funds Flow Statement – Preparation of funds Flow Statement – Principle Sources of Funds – Possible Uses (Applications of Funds) of Funds – Techniques of Funds Flow Statement – Schedule of Changes in Working Capital – Statement of Sources and Uses of Fund – Simple Problems on Preparation of Funds Flow Statement.

4.      CASH FLOW ANALYSIS: 

Meaning of Cash Flow and Cash Flow Statement – Objectives – Uses – Limitations of Cash Flow Statement – Cash Flow Statement versus Funds Flow Statement – Preparation of Cash Flow Statement – Techniques of Cash Flow Statement – Items of Cash Flows (Sources) – Items of Cash Out Flows (Uses) – Simple Problems on Preparation of Cash Flow Statement.

5.      MARGINAL COSTING AND COST-VOLUME-PROFIT ANALYSIS:

Meaning of Marginal Cost and Marginal Costing – Features – Merits – Demerits of Marginal Costing – The Concept of Cost-Volume-Profit Analysis (Break Even Analysis) and it’s Importance - The Concepts of Contribution, Break Even Point, Profit Volume Ratio (P/V Ratio) Margin of Safety and their Significance – Simple Problems on Marginal Costing and Cost-Volume-Profit Analysis.

6.      BUDGETS AND BUDGETARY CONTROL:

Meaning of Budget and Budgetary Control – Classification of Budgets – Simple Problems on Preparation of Flexible Budget, Cash Budget, Production Budget and Sales Budget Only.

 

 

 

GENERAL OBJECTIVES

 

1.      To Familiarize the Students with various Concepts and Principles of Management Accounting.  

2.      To Enable the Students to acquire Skills needed to Present Accounting Information to the Management for Decision Making.

3.      To Provide a fundamental insight into Ratio Analysis, Funds Flow Analysis, Cash Flow Analysis, Budgets and Budgetary Control, Marginal Costing and Cost –Volume-Profit Analysis,

4.      To Provide required knowledge on Management Accounting Techniques and enable the students to apply them for Effective Planning and Control of Operations for the purpose of Improvement of Decision Making Process.

                     

SPECIFIC OBJECTIVES

               

1.1. To Explain the Meaning of Management Accounting.

1.2. To List out the Objectives, Advantages and Limitations of Management Accounting.

1.3. To Narrate the Scope of Management Accounting.

1.4. To Explain about the Installation of Management Accounting System.

1.5. To Explain the Tools of Management Accounting.

1.6. To Identify the Points of Distinction between the Management Accounting and the

        Financial Accounting.

 

2.1. To Explain the Meaning of Ratio.

2.2. To Explain the Objectives, Merits and Limitations of Ratio Analysis.

2.3. To Identify the Interested Parties in Ratio Analysis.

2.4. To Explain the Classification of Ratios.

2.5. To Solve Simple Problems on Calculation and Interpretation of Financial Ratios. (Current

        Ratios, Liquid/Quick/Acid Test Ratio, Debt Equity Ratio, Proprietary Ratio, Capital

        Gearing Ratio, Super Quick Ratio, Net Working Capital Ratio and Fixed Assets to

        Proprietary Funds Ratio.

2.6. To Solve Simple Problems on Calculation and Interpretation of Profitability Ratios (Gross

        Profit Ratio, Operating Ratio and Net Profit Ratio)

2.7. To Solve Simple Problems on Calculation and Interpretation of Turnover Ratios (Stock

       Turnover Ratio, Debtors Turnover Ratio, Creditors Turnover Ratio, Working Capital

       Turnover Ratio, Fixed Assets Turnover Ratio and Current Assets Turnover Ratio)                           

 

3.1. To Explain the Meaning of Fund, Flow of Fund and Funds Flow Statement.

3.2. To List out the Merits and Limitations of Funds Flow Statement (Analysis)  

3.3. To Identify the Parties Interested in Funds Flow Statement.

3.4. To Explain the Process of Preparation of Funds Flow Statement.

3.5. To Identify the Principal Sources of Funds and the Possible Uses (Applications) of Funds.

3.6. To Identify the Techniques of Funds Flow Statement.

3.7. To Prepare the Schedule of Changes in Working Capital and Statement of Sources and Uses

       of Funds.

1.8.  To Solve Simple Problems on Preparation of Funds Flow Statement.

 

4.1. To Explain the Meaning of Cash Flow and Cash Flow Statement. 

4.2. To List out the Objects, Uses and Limitations of Cash Flow Statement.

4.3. To Identify the Points of Distinction between Cash Flow Statement and Funds Flow

       Statement.

4.4. To Explain the Process of Preparation of Cash Flow Statement.  

4.5. To Explain the Techniques of Cash Flow Statement.

4.6. To Explain the Items of Cash Flows (Sources) and Items of Cash out Flows (Uses)

4.6. To Solve Simple Problems on Preparation of Cash Flow Statement.

 

5.1. To Explain the Meaning of Marginal Cost and Marginal Costing.

5.2. To List out the Features, Merits and Demerits of Marginal Costing. 

5.3. To Explain the Concept Cost-Volume-Profit Analysis (Break Even Analysis) and it’s

      Importance.

5.4. To Explain the Concepts of Contribution, Break Even Point, Profit Volume Ratio (P/V

       Ratio), Margin of Safety and their Significance.

5.5. To Solve Simple Problems on Marginal Costing and Cost-Volume –Profit Analysis.

                                                                                                                                         

6.1. To Explain the Meaning Budget and Budgetary Control.

6.2. To Explain the Classification of Budgets.

6.3. To Solve Simple Problems on Preparation of Flexible Budget, Cash Budget, Production

       Budget and Sales Budget Only.

 

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            BOOKS RECOMMENDED:

 

1.      Mangaement Accounting by R.S.N.Pillai & Bagavathi.V – S.Chand & Company Ltd.

2.      Accounting for Management by N.P.Srinivasan & M.Sakthivel Murugan – S.Chand & Company Ltd.

3.      Essentials of Management Accounting by Dr.P.N.Reddy & H.R.Appannaiah.

4.      Strategic Management Accounting: Theory and Practice by Kumar - Cengage

            Learning       

      5.   Management Accounting by S.P.Gupta – Sahitya Bhavan. Agra.

6.   Management Accounting – M Muniraj & K Ramachandar – Himalaya Publishers.

7.   Financial Management – Reddy, Appannaiah and Satya Prasad

8.   Management Accounting – Appannaiah, Reddy and Mukund Sharma – Himalaya

      Publishers

9.   Advance Financial Management – B.G.Sathya Prasad and G.A Raghu – Himalaya

      Publishers.

                 10.  Financial Accounting – Ii S.Anil Kumar, V.Rajesh Kumar and B.Mariyappa.

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