Cornerstones of Managerial Accounting, 4^th edition

By Mowen, Hansen, and Heitger

Learning Objectives by Chapter

Chapter 1 - Introduction to Managerial Accounting

1 Explain the meaning of managerial accounting.

2 Explain the differences between managerial accounting and financial accounting.

3 Identify and explain the current focus of managerial accounting.

4 Describe the role of managerial accountants in an organization.

5 Explain the importance of ethical behavior for managers and managerial accountants.

6 Identify three forms of certification available to managerial accountants.

Chapter 2 - Basic Managerial Accounting Concepts

1 Explain the meaning of cost and how costs are assigned to products and services.

2 Define the various costs of manufacturing products and providing services as well as the costs of selling and administration.

3 Prepare income statements for manufacturing and service organizations.

Chapter 3 - Cost Behavior

1 Explain the meaning of cost behavior, and define and describe fixed and variable costs.

2 Define and describe mixed and step costs.

3 Separate mixed costs into their fixed and variable components using the high-low method, the scattergraph method, and the method of least squares.

4 (Appendix 3A) Use a personal computer spreadsheet program to perform the method of least squares.

Chapter 4 - Cost-Volume-Profit Analysis: A Managerial Planning Tool

1 Determine the break-even point in number of units and in total sales dollars.

2 Determine the number of units that must be sold, and the amount of revenue required, to earn a targeted profit.

3 Prepare a profit-volume graph and a cost-volume-profit graph, and explain the meaning of each.

4 Apply cost-volume-profit analysis in a multiple-product setting.

5 Explain the impact of risk, uncertainty, and changing variables on cost-volume-profit analysis.

Chapter 5 - Job-Order Costing

1 Describe the differences between job-order costing and process costing, and identify the types of firms that would use each method.

2 Compute the predetermined overhead rate, and use the rate to assign overhead to units or services produced.

3 Identify and set up the source documents used in job-order costing. (optional)

4 Describe the cost flows associated with job-order costing.

5 (Appendix 5A) Prepare the journal entries associated with job-order costing.

6 (Appendix 5B) Allocate support department costs to producing departments. (optional)

Chapter 6 - Process Costing

1 Describe the basic characteristics and cost flows associated with process manufacturing.

2 Define equivalent units and explain their role in process costing. Explain the differences between the weighted average method and the FIFO method of accounting for process costs.

3 Prepare a departmental production report using the weighted average method.

4 Explain how nonuniform inputs and multiple processing departments affect process costing.

5 (Appendix 6A) Prepare a departmental production report using the FIFO method. (omit)

Chapter 8 - Absorption and Variable Costing, and Inventory Management

1 Explain the difference between absorption and variable costing.

2 Prepare segmented income statements. (cover in Chapter 12)

3 Discuss inventory management under the economic order quantity and just-in-time (JIT) models. (optional)

Chapter 9 - Profit Planning

1 Define budgeting and discuss its role in planning, control, and decision making.

2 Define and prepare the operating budget, identify its major components, and explain the interrelationships of its various components.

3 Define and prepare the financial budget, identify its major components, and explain the interrelationships of its various components.

4 Describe the behavioral dimension of budgeting.

Chapter 10 - Standard Costing: A Managerial Control Tool

1 Explain how unit standards are set and why standard cost systems are adopted.

2 Explain the purpose of a standard cost sheet.

3 Describe the basic concepts underlying variance analysis, and explain when variances should be investigated.

4 Compute the materials variances, and explain how they are used for control.

5 Compute the labor variances, and explain how they are used for control.

6 (Appendix 10A) Prepare journal entries for materials and labor variances. (optional)

Chapter 11 - Flexible Budgets and Overhead Analysis

1 Prepare a flexible budget, and use it for performance reporting.

2 Calculate the variable overhead variances, and explain their meaning.

3 Calculate the fixed overhead variances, and explain their meaning.

4 Prepare an activity-based flexible budget. (omit)

Chapter 12 - Performance Evaluation and Decentralization

Cover learning objective 2 from Chapter 8.

1 Explain how and why firms choose to decentralize.

2 Compute and explain return on investment.

3 Compute and explain residual income and economic value added.

4 Explain the role of transfer pricing in a decentralized firm. (omit)

5 (Appendix 12A) Explain the uses of the Balanced Scorecard, and compute cycle time, velocity, and manufacturing cycle efficiency. (optional)

Chapter 13 - Short-Run Decision Making: Relevant Costing

1 Describe the short-run decision-making model, and explain how cost behavior affects the information used to make decisions.

2 Apply relevant costing and decision-making concepts in a variety of business situations.

3 Choose the optimal product mix when faced with one constrained resource.

4 Explain the impact of cost on pricing decisions.

Chapter 14 - Capital Investment Decisions

1 Explain the meaning of capital investment decisions, and distinguish between independent and mutually exclusive capital investment decisions.

2 Compute the payback period and accounting rate of return for a proposed investment, and explain their roles in capital investment decisions.

3 Use net present value analysis for capital investment decisions involving independent projects.

4 Use the internal rate of return to assess the acceptability of independent projects.

5 Explain the role and value of postaudits.

6 Explain why net present value is better than internal rate of return for capital investment decisions involving mutually exclusive projects.

7 (Appendix 14A) Explain the relationship between current and future dollars.