BRAC BUSINESS SCHOOL

Cost Accounting

Everything, literally every single thing has a cost – Saif Hossain

Summer 2016
Class Room: UB 20102
Class Schedule: Monday & Wednesday, 3:30 PM – 4:50 PM

Instructor: Saif Hossain

Office: UB20615
E-mail: saifhossain@bracu.ac.bd
Office Hours: Monday & Wednesday, 2:00 PM – 3:30 PM

I. Rationale:
The objective of cost accounting is to have an idea about the costing of different cost objects and
associated profitability. It also includes the different elements of costs and necessary control,
and in the process determines the selling price to ensure desired profit. Yet with the
development of business and industry, its objectives are changing day by day.

II. Course Aims and Outcomes:

Aims
The course aims to equip students with different costing techniques of different types of cost
objects, let it be a product, a service, an operation or an entire business. No matter what
profession your future holds for you, willingly or unwillingly, knowingly or unknowingly, you
will be dealing with costs.

Specific Learning Outcomes:

By the end of this course, students will:
 have an idea about measurement, analysis, accumulation and control of various elements
of cost.
 get oriented with various systems of maintaining cost accounting record.
 acquainted with techniques of preparation of cost of production statements under
different costing system.
 be able to impart know-how of cost control and cost reduction tools.

III. Format and Procedures:

Teaching will take the form of 80 minutes sessions whereby the broad approach to the subject
area will be introduced and the key areas of content will be addressed through lectures,
discussions, case studies, problem solving, readings, assignments etc.

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IV. My Stance
Lectures will be followed by problem solving sessions. Active participation and questions are
highly encouraged. Students are expected not to miss classes as the topics are inter-related.

V. Course Requirements:

# Assessment Areas Weights (%)

1 Class attendance (as per BRACU policy) 5
2 Quizzes ( 2 out of 3) 20
3 Midterm Examination 20
4 Assignments & Term Paper (3 & 1 respectively) 15
5 Final Examination (comprehensive) 40
TOTAL 100

1. Class attendance and participation policy: Students who are unable to attend at least 70% of
the number classes are not allowed to sit for the final exam as per university rules.

2. Course readings:
Core Reading:
Cost accounting- A managerial emphasis — Charles T. Horngren (14th edition)
Recommended Reading:
Cost Accounting Foundations and Evolutions, 8e, Kinney & Raiborn
Principles of Cost Accounting 15e, Vanderbeck

VI. Grading Procedures:

Range of Marks Grade GPA Remarks
90 to 100 A 4.0 Excellent
85 to <90 A- 3.7 “
80 to <85 B+ 3.3 “
75 to <50 B 3.0 Good
70 to <75 B- 2.7 “
65 to <70 C+ 2.3 “
60 to <65 C 2.0 Fair
57 to <60 C- 1.7 “
55 to <57 D+ 1.3 “
52 to <55 D 1.0 Poor
50 to <52 D- 0.7 “
<50 F 0.0 Failure

VII. Academic Integrity

Each student in this course is expected to abide by the BRAC University Code of Academic
Integrity. Any work submitted by a student in this course for academic credit will be the
student's own work. Also refer to plagiarism policy that will be on the web.

You are encouraged to study together and to discuss information and concepts covered in lecture
and the sections with other students. You can give "consulting" help to or receive "consulting"
help from such students. However, this permissible cooperation should never involve one
student having possession of a copy of all or part of work done by someone else, in the form of
an e-mail, an e-mail attachment file, a diskette, or a hard copy.

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If copying occurs, both the student who copied work from another student and the student who
gave material to be copied will both automatically receive a zero for the assignment. Penalty for
violation of this Code can also be extended to include failure of the course and University
disciplinary action.

During examinations, you must do your own work. Talking or discussion is not permitted during
the examinations, nor may you compare papers, copy from others, or collaborate in any way.
Any collaborative behavior during the examinations will result in failure of the exam, and may
lead to failure of the course and University disciplinary action.

VIII. Accommodations for students with disabilities

I am available to discuss appropriate academic accommodations that may be required for student
with disabilities. Requests for academic accommodations are to be made during the first three
weeks of the semester, except for unusual circumstances, so arrangements can be made. Students
are encouraged to register with Student Disability Services to verify their eligibility for
appropriate accommodations.

IX. Tentative Course Schedule

Session Contents
1&2 The nature, concept and classification of Cost Accounting
Definition of accounting, financial accounting vs. cost
accounting, management accounting vs. cost accounting, cost
objects, costs and cost terminology, cost classification,
commonly used classification of manufacturing cost, Income
statement and cost of goods manufactured statement.
3&4 Costing and control of materials
Accounting for materials, system of accounting for materials
issued to production and ending materials inventory, control
procedures of material.
5 Costing and control of Labor
Cost included in labor, accounting for labor, journalizing labor cost

6 Quiz 1
6&7 Costing and control of factory overhead
Factory overhead costs, estimated factory overhead costs,
determination of factory overhead application rates, actual vs.
applied factory overhead costs, accounting for actual factory
overhead costs and allocation of costs.
8&9 Activity Based Costing
Types of costs system, how costs are treated under activity-based
costing, steps for implementing activity-based costing, a comparison
of traditional and ABC system, the limitation of activity-based
costing, activity based management.

10 & Job order costing

11 Building - block concept of costing systems, accounting for job order
costing, spoiled units, scrap material, waste material in a job order
cost system.

12 Midterm Examination
13 – 15 Process costing
Job order costing vs. process costing, the cost of production report,
spoilage, rework and scrap.

16 & Cost allocation: Joint products and Byproducts

17 Joint cost basics, main products, joint products and byproducts, why
allocate joint costs?, nature of Joint products and byproducts,
methods of costing byproducts, methods of allocating joint
production cost to joint products, joint cost analysis for managerial

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 decision making.

18 Quiz 3
18 – Standard costing and variance analysis
20 Purposes of standard costing, types of cost standards, variance
analysis: material, labor, overhead- variable and fixed, volume
variance etc.

21 & Cost management

22 Life cycle costing, target costing, value engineering, kaizen costing,
business process reengineering, cost of quality, cost management
and the value chain, benchmarking, environmental cost
management, just-in-time system.

23 Quiz 4