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

Syllabus

SECTION A: INTRODUCTION TO MANAGEMENT ACCOUNTING [5%]

1. 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%]

2. 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%]

3. Marginal Costing - 10%
  • 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)
4. Applications of Marginal Costing in Short Term Decision Making - 10%
  • 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
5. Transfer Pricing - 10%
  • 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%]

6. 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%]

7. 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%]

8. 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%]

9. Responsibility Accounting - 5%
  • Concept of Cost, Revenue, Profit and Responsibility Centres
  • Preparation of Responsibility Report
 

SECTION H: DECISION THEORY [10%]

10. Decision Theory - 10%
  • Decision Making under Certainty
  • Decisions Making under Risk
  • Decision Making under Uncertainty
  • Decision Tree