CHINHOYI UNIVERSITY OF TECHNOLOGY

SCHOOL OF ENTREPRENEURSHIP AND BUSINESS

SCIENCES
DEPARTMENT OF ACCOUNTING SCIENCES AND
FINANCE
+ P. Bag 7724, CHINHOYI, ZIMBABWE
( +263 67 22203-5 ext 216/ +263 773 593 523
2 +263 67 28957
Website: www.cut.ac.zw

The Chairperson’s Office

COURSE LECTURERS: GWIZO K., 0734796726, kgwizu@cut.ac.zw, Block 6

Room 9

1.0 Course Tile and Code

Management Accounting for Business – CUAC 217

2.0 Time Allocation:

4 hours per week for lectures, with an additional 1 hour reserved for
tutorials, should they prove necessary.

3.0 Rationale
This course is designed to introduce students to principles, concepts,
practices and applications of managerial accounting in business
contexts. It represents the only paper in Management Accounting for
Business. It assumes no prior knowledge of accounting.

The course covers basic topics in managerial accounting and

introduces a business-management approach to the development and
use of accounting information and various decision making tools to
make sound business decisions. The course focuses on an enterprises’
internal accounting systems and their use in decision making, planning
and control. It emphasises the role of the management accountant,
cost concepts and terminology, job costing, CVP analysis, budgeting
 and budgetary control, standard costing and variance analysis, and
inventory control methods.

4.0 Purpose
This course is meant to introduce and broaden non-accounting
students’ understanding of basic managerial accounting, with
emphasis on the use of various decision making tools for effective
management.

5.0 Main Capabilities

Upon the successful completion of the course, students should be able

to:

 Explain managerial accounting concepts and terminology

 Analyse and ascertain costs
 Prepare and analyse operating statements and reports
 Prepare elementary budgets and anayse budget variances
 Perform elementary variances analysis for material and labour
 Apply cost-volume-profit analysis in decision making

6.0 Methods of Teaching

Each section of the course outline will be thoroughly discussed
(taught), with comprehensive examples articulated to the students.
Students will also be asked to research in groups and present their
answers during lectures where debates are encouraged and the
lecturer will moderate the debates. The following methods among
others will be used:
Lectures
Tutorials
Demonstrations
Discussions

7.0 Students Assessments

1. Course work comprises at least 2 tests and 1 group assignment, with
30% weight of the final mark. Questions in the tests will cover all the
pertinent aspects of the course covered up to the time of the test, and
will serve as mock exams, in preparation for the final exam. Aspects
tested will not overlap.
2. Final exam constitute 70% of the final mark and will examine all the
pertinent aspect of the course.
3. The final mark will be a summation of course work and the exam mark.
 4. The School Secretariat will provide course evaluation forms to
students. Once completed, they are to be submitted to the Department
Chairperson before the students write the exam. The Chairperson will
provide feedback to the lecturer.

8.0 Course Content

8.1 Introduction to managerial accounting

8.1.1 Definition of key terms in managerial accounting
8.1.2 Fields of accounting: Financial accounting and
managerial accounting
8.1.3 Place and function of cost accounting

8.1.4 Role of the management (corporate) accountant in

decision making
8.1.5 characteristics of a good managerial accounting
information

8.2 Cost analysis and cost ascertainment

8.2.1 Cost analysis: primary classification of product costs
8.2.1.1 Definition of cost, cost object, cost
unit and cost centre
8.2.1.2 Cost centre, direct and indirect costs
8.2.1.3 Cost unit, direct and indirect costs
8.2.1.4 Manufacturing costs

8.2.2 Cost ascertainment

8.2.2.1 Materials
a) Elements of a good method of material control
b) Acquisition – purchasing procedure, economic order
quantity, maximum stock level, reorder level, lead time
and safety stock
c) Receipt and storage of materials
d) Issuing of inventory
e) Pricing issues and inventory valuation – FIFO, LIFO,
AVCO and standard price

8.2.2.2 Overheads
a) Classification of overheads – manufacturing and non-
manufacturing
 b) Allocation of overheads to cost centres using overhead
analysis sheet
c) Calculation of overhead absorption rates
d) Absorption of overheads by products
e) Over- and-under absorption of overheads

8.3 Planning and control

8.3.1 Cost behaviour and volume of activity

8.3.1.1 Variable and fixed costs
8.3.1.2 Semi-variable costs
8.3.1.3 Methods of separating fixed costs
from variable costs: high/low method

8.3.2 Budgeting and budgetary control

8.3.2.1 Definition of budget, budgeting and
budgetary control
8.3.2.2 Benefits of budgeting
8.3.2.3 Approaches to budgeting
8.3.2.4 Preparation of budgets
8.3.2.5 Budgetary control system:
Advantages, limitations and
installation

8.3.3 Standard costing

8.3.3.1 Definition of standard cost and
standard costing
8.3.3.2 Purpose and advantages of standard
costing
8.3.3.3 Types of standards
8.3.3.4 Setting standards for direct materials,
direct labour and overheads
8.3.3.5 Elementary variance analysis
a) Material: total, price and usage variances
b) Labour: total, rate and efficiency variances
c) Margin: total, price and volume variances
d) Variable overhead: total, spending and efficiency
variances
8.3.4.6 Accounting treatment of variances and
variance reporting to management
8.4 Decision making
8.4.1 Marginal costing and absorption
8.4.1.1 Definition of marginal costing and
absorption costing
8.4.1.2 Marginal costing: Approach of profit
reporting and inventory valuation
8.4.1.3 Absorption costing: Approach of profit
reporting and inventory valuation

8.4.2 Cost-volume-profit analysis

8.4.2.1 Definition of CVP analysis
8.4.2.2 Uses and application of CVP analysis
8.4.2.3 Assumptions of CVP analysis
8.4.2.4 Break-even analysis: equation
method, break even chart method and
contribution margin method

COURSE TEXT(S) RECOMMENDED READING

Ray H. Garrison etal 2003 Management Accounting. European
edition. McGraw-Hill Education Publications (UK)
Lucy T. 2003 Cost and Management Accounting. Latest edition.
DP Publications. London
Drury C. Cost and Management Accounting. Latest edition
Horngren . Cost and Management Accounting with a managerial
emphasis. Latest edition