ACCT 2302 - Objectives

Managerial Accounting, 13e, Garrison, Noreen, Brewer

After studying Chapter 1, you should be able to:

LO1	Understand the role of management accountants in an organization.
LO2	Understand the basic concepts underlying Lean Production, the Theory of Constraints (TOC), and Six Sigma.
LO3	Understand the importance of upholding ethical standards.

After studying Chapter 2, you should be able to:

LO1	Identify the major differences and similarities between financial and managerial accounting.
LO2	Identify and give examples of each of the three basic manufacturing cost categories.
LO3	Distinguish between product costs and period costs and give examples of each.
LO4	Prepare an income statement including calculation of the cost of goods sold.
LO5	Prepare a schedule of cost of goods manufactured.
LO6	Understand the differences between variable costs and fixed costs.
LO7	Understand the differences between direct and indirect costs.
LO8	Understand cost classifications used in making decisions: differential costs, opportunity costs, and sunk costs.
LO9	(Appendix 2A) Properly account for labor costs associated with idle time, overtime, and fringe benefits. Optional
LO10	(Appendix 2B) Identify the four types of quality costs and explain how they interact. Optional

After studying Chapter 3, you should be able to:

LO1	Distinguish between process costing and job-order costing and identify companies that would use each costing method.
LO2	Identify the documents used in a job-order costing system.
LO3	Compute predetermined overhead rates and explain why estimated overhead costs (rather than actual overhead costs) are used in the costing process.
LO4	Understand the flow of costs in a job-order costing system and prepare appropriate journal entries to record costs.
LO5	Apply overhead cost to Work in Process using a predetermined overhead rate.
LO6	Prepare schedules of cost of goods manufactured and cost of goods sold.
LO7	Use T-accounts to show the flow of costs in a job-order costing system.
LO8	Compute underapplied or overapplied overhead cost and prepare the journal entry to close the balance in Manufacturing Overhead to the appropriate accounts.

After studying Chapter 4, you should be able to:

LO1	Record the flow of materials, labor, and overhead through a process costing system.
LO2	Compute the equivalent units of production using the weighted-average method.
LO3	Compute the cost per equivalent unit using the weighted-average method.
LO4	Assign costs to units using the weighted-average method.
LO5	Prepare a cost reconciliation report.

After studying Chapter 5, you should be able to:

LO1	Understand how fixed and variable costs behave and how to use them to predict costs.
LO2	Use a scattergraph plot to diagnose cost behavior. Lab Assignment
LO3	Analyze a mixed cost using the high-low method.
LO4	Prepare an income statement using the contribution format.
LO5	(Appendix 5A) Analyze a mixed cost using the least-squares regression method. Lab Assignment

After studying Chapter 6, you should be able to:

LO1	Explain how changes in activity affect contribution margin and net operating income.
LO2	Prepare and interpret a cost-volume-profit (CVP) graph and a profit graph.
LO3	Use the contribution margin ratio (CM ratio) to compute changes in contribution margin and net operating income resulting from changes in sales volume.
LO4	Show the effects on contribution margin of changes in variable costs, fixed costs, selling price, and volume.
LO5	Determine the level of sales needed to achieve a desired target profit.
LO6	Determine the breakeven point.
LO7	Compute the margin of safety and explain its significance.
LO8	Compute the degree of operating leverage at a particular level of sales and explain how it can be used to predict changes in net operating income.

After studying Chapter 7, you should be able to:

LO1	Explain how variable costing differs from absorption costing and compute unit product costs under each method.
LO2	Prepare income statements using both variable and absorption costing.
LO3	Reconcile variable costing and absorption costing net operating incomes and explain why the two amounts differ.
LO4	Understand the advantages and disadvantages of both variable and absorption costing.

After studying Chapter 9, you should be able to:

LO1	Understand why organizations budget and the processes they use to create budgets.
LO2	Prepare a sales budget, including a schedule of expected cash collections.
LO3	Prepare a production budget.
LO4	Prepare a direct materials budget, including a schedule of expected cash disbursements for purchases of materials.
LO5	Prepare a direct labor budget.
LO6	Prepare a manufacturing overhead budget.
LO7	Prepare a selling and administrative expense budget.
LO8	Prepare a cash budget.
LO9	Prepare a budgeted income statement.
LO10	Prepare a budgeted balance sheet.

After studying Chapter 10, you should be able to:

LO1	Prepare a flexible budget.
LO2	Prepare a report showing activity variances.
LO3	Prepare a report showing revenue and spending variances.
LO4	Prepare a performance report that combines activity variances and revenue and spending variances.

After studying Chapter 11, you should be able to:

LO1	Explain how direct materials standards and direct labor standards are set.
LO2	Compute the direct materials price and quantity variances and explain their significance.
LO3	Compute the direct labor rate and efficiency variances and explain their significance.
LO4	Compute the variable manufacturing overhead rate and efficiency variances.
LO5	Compute delivery cycle time, throughput time, and manufacturing cycle efficiency (MCE).
LO6	(Appendix 11A) Compute and interpret the fixed overhead budget and volume variances.

After studying Chapter 12, you should be able to:

LO1	Prepare a segmented income statement using the contribution format, and explain the difference between traceable fixed costs and common fixed costs.
LO2	Compute return on investment (ROI) and show how changes in sales, expenses, and assets affect ROI.
LO3	Compute residual income and understand its strengths and weaknesses.

After studying Chapter 13, you should be able to:

LO1	Identify relevant and irrelevant costs and benefits in a decision.
LO2	Prepare an analysis showing whether a product line or other business segment should be dropped or retained.
LO3	Prepare a make or buy analysis.
LO4	Prepare an analysis showing whether a special order should be accepted.
LO5	Determine the most profitable use of a constrained resource and the value of obtaining more of the constrained resource.
LO6	Prepare an analysis showing whether joint products should be sold at the split-off point or processed further.

After studying Chapter 14, you should be able to:

LO1	Evaluate the acceptability of an investment project using the net present value method.
LO2	Evaluate the acceptability of an investment project using the internal rate of return method.
LO3	Evaluate an investment project that has uncertain cash flows.
LO4	Rank investment projects in order of preference.
LO5	Determine the payback period for an investment.
LO6	Compute the simple rate of return for an investment.
LO7	(Appendix 14A) Understand present value concepts and the use of present value tables.