Management Accounting (MA) (Paper-12) CMA Inter Group 2

SECTION A: INTRODUCTION TO MANAGEMENT ACCOUNTING [5%]

• Conceptual Understanding
• Relationship between Management Accounting and Cost Accounting
• Role of a Management Accountant in Modern Business World

SECTION B: ACTIVITY BASED COSTING [10%]

• Traditional Cost System
• Definition and Meaning of Activity Based Costing (ABC)
• Steps in ABC System
• Cost Pools and Cost Drivers
• Merits and Demerits of ABC System
• Activity Based Information and Decision Making

SECTION C: DECISION MAKING TOOLS [30%]

• Concept
• Cost-Volume-Profit Analysis
• Break-Even Charts and Profit Charts
• Multiple Product Break Even Analysis
• Differential Cost Analysis
• Marginal Costing Vs. Absorption Costing (advanced applications)

• Pricing Decision
• Make or Buy decisions
• Accept an Order or Reject
• Optimum Utilization of Factors of Production [Limiting Factor Analysis]
• Replacement Decision
• Evaluation of Alternative Choices
• Subcontracting and Ancillarisation
• Expansion of Business
• Shutdown or Continue

• Concept
• Methods and Techniques
• Divisional Performance and Problem of Goal Congruence
• Determination of Inter-departmental or Inter-company Transfer Price
• International Transfer Pricing

SECTION D: STANDARD COSTING AND VARIANCE ANALYSIS [15%]

•  Material and Labour Variances
•  Variable Overhead Variance
•  Fixed Overhead Variance
•  Sales Variance
•  Interpretation of Variances and Inferences Drawn

SECTION E: FORECASTING, BUDGETING AND BUDGETARY CONTROL [15%]

• Introduction
• Rationale for Budgets
• General principles in the Budgetary process
• Formulation of various types of Budgets
  • Fixed and Flexible Budgets
  • Functional Budgets
  • Master Budget
  • Cash Budget
  • Zero Base Budget
  • Performance Budget
  • Programme Budget
  • Rolling Budget
  • Outcome Budget
  • Budgetary Control
    • Rationale for Budgetary Control
    • Importance and Significance of Budgetary Control
    •  Linkage of Budgetary Control with Standard Costing and Profit Reconciliation
    • Benchmarking and Key Success Factor
    •  Interpretation of Under and Over Performance and Inferences Drawn for Corrective Actions 

SECTION F: DIVISIONAL PERFORMANCE MEASUREMENT [10%]

• Organizations with Multiple divisions, Benefits of Decentralization
• DuPont Analysis
• Divisional Performance Measurement tools – ROI, Residual Income
• Economic Value Added – Definition, EVA Centre, EVA Drivers
• Introduction to Learning Curve
• Balanced Score Card for Variable Pay Management
   

SECTION G: RESPONSIBILITY ACCOUNTING [5%]

• Concept of Cost, Revenue, Profit and Responsibility Centres
• Preparation of Responsibility Report

SECTION H: DECISION THEORY [10%]

• Decision Making under Certainty
• Decisions Making under Risk
• Decision Making under Uncertainty
• Decision Tree