Introduction to Management Accounting

Cover
Contents
Guided tour of the book
Guided tour of MyAccountingLab
Preface
Acknowledgements
1 Managerial accounting and organisations
	Starbucks
	Accounting and decision making
	Cost–benefit and behavioural considerations
	The management process and accounting
	Planning and control for product life cycles and the value chain
	Accounting’s position in the organisation
	Adaptation to change
	Ethical conduct for professional accountants
	Highlights to remember
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
2 Introduction to cost behaviour and cost–volume relationships
	Boeing Company
	Identifying resources, activities, costs and cost drivers
	Variable- and fixed-cost behaviour
	Cost–volume–profit analysis
	Additional uses of cost–volume analysis
	Nonprofit application
	Highlights to remember
	Appendix 2A: Sales-mix analysis
	Appendix 2B: Impact of income taxes
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
3 Measurement of cost behaviour
	Air Arabia
	Cost drivers and cost behaviour
	Management influence on cost behaviour
	Cost functions
	Methods of measuring cost functions
	Highlights to remember
	Appendix 3: Use and interpretation of least-squares regression
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
4 Cost management systems and activity-based costing
	Dell
	Cost management systems
	Cost accounting systems
	Cost terms used for strategic decision making and operational control purposes
	Cost terms used for external reporting purposes
	Traditional and activity-based cost accounting systems
	Activity-based management: a cost management system tool
	Highlights to remember
	Appendix 4: Detailed illustration of traditional and activity-based cost accounting systems
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
	HBS case study: Siemens Electric Motor Works
5 Relevant information for decision making with a focus on pricing decisions
	Mercadona
	The concept of relevance
	Pricing special sales orders
	Basic principles for pricing decisions
	General influences on pricing in practice
	Cost-plus pricing
	Target costing
	Highlights to remember
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	HBS case study: La Grande Alliance: Restaurant Français
6 Relevant information for decision making with a focus on operational decisions
	Maersk Line
	Analysing relevant information: focusing on the future and differential attributes
	Make-or-buy decisions
	Deletion or addition of products, services or departments
	Optimal use of limited resources: product-mix decisions
	Joint product costs: sell or process further decisions
	Keeping or replacing equipment
	Identify irrelevant or misspecified costs
	Conflicts between decision making and performance evaluation
	Highlights to remember
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
7 Introduction to budgets and preparing the master budget
	Ritz-Carlton
	Budgets and the organisation
	Types of budgets
	Preparing the master budget
	Budgets as financial planning models
	Highlights to remember
	Appendix 7: Use of spreadsheet models for sensitivity analysis
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
8 Flexible budgets and variance analysis
	McDonald’s
	Using budgets and variances to evaluate results
	Isolating the causes of variances
	Flexible-budget variances in detail
	Overhead variances
	Highlights to remember
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
9 Management control systems and responsibility accounting
	Diesel
	Management control systems
	Management control systems and organisational goals
	Designing management control systems
	Controllability and measurement of financial performance
	Measurement of nonfinancial performance
	The balanced scorecard
	Management control systems in service, government, and nonprofit organisations
	Future of management control systems
	Highlights to remember
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Cases
10 Management control in decentralised organisations
	Nike
	Centralisation versus decentralisation
	Performance metrics and management control
	Measures of profitability
	Economic profit or economic value added (EVA)
	ROI or economic profit?
	A closer look at invested capital
	Transfer pricing
	Keys to successful management control systems
	Highlights to remember
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	HBS case study: Empire Glass Company
11 Capital budgeting
	Toyota Motor Corporation
	Capital budgeting for programmes or projects
	Discounted-cash-flow models
	Sensitivity analysis and risk assessment in DCF models
	The NPV comparison of two projects
	Income taxes and capital budgeting
	Confusion about depreciation
	Other models for analysing long-range decisions
	Performance evaluation
	Highlights to remember
	Appendix 11: capital budgeting and inflation
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Cases
12 Cost allocation
	Haier
	A general framework for cost allocation
	Allocation of service department costs
	Allocation of costs to product or service cost objects
	An ABC approach
	Allocation of costs to customer cost objects to determine customer profitability
	Allocation of central corporate support costs
	Allocation of joint costs and by-product costs
	Highlights to remember
	Appendix 12: Multistage ABC (MSABC) systems
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Cases
13 Accounting for overhead costs
	Dell
	Accounting for factory overhead
	Illustration of overhead application
	Problems of overhead application
	Variable versus absorption costing
	Fixed overhead and absorption costs of product
	Effect of other variances
	Highlights to remember
	Appendix 13: Comparisons of production-volume variance with other variances
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
	Case study
14 Job-order costing and process-costing systems
	Haribo
	Distinction between job-order costing and process costing
	Illustration of job costing
	Activity-based costing/management in a job-costing environment
	Job costing in service and nonprofit organisations
	Process costing basics
	Application of process costing
	Physical units and equivalent units (steps 1 and 2)
	Calculation of product costs (steps 3 to 5)
	Effects of beginning inventories
	Process costing in a JIT system: backflush costing
	Highlights to remember
	Accounting vocabulary
	Fundamental assignment material
	Additional assignment material
Appendix A: Recommended reading
Appendix B: Fundamentals of compound interest and the use of present-value tables
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Company name index
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