Course Outline

Course Title: (Cost Accounting) B.Com (Term System) Term-III Paper-IV

Course Objectives:

  1. State and evaluate choices between alternative product costing systems and methods in a cost-benefit context.
  2. To develop an understanding of students to utilize cost data in planning and control.

Course Contents:

Topic / Source / Sections
Concept and Scope of Cost Accounting:
Definition and cocept of cost. Cost object, Cost elements. Definition, concept and scope of cost accounting. Objectives of cost accounting. Cost Accounting Vs Financial Accounting. Use of cost data. Chart of accounts and coding for costing / Ch 2, Book 1
Ch 1, Book 4 / A
Cost Classification and Flow:
Product and period cost, direct and indirect cost, Differential cost and revenue, Opportunity and Sunk cost, fixed and variable cost, mixed cost, statement of cost of goods manufactured and sold statement. / Ch 1, Book 2
Ch 2, Book 1 / A
Material Costing, Planning and Control:
  • Procedure for material procurement and use
  • Material costing methods
  • Costing Procedure for spoiled, scrap and defective work
  • Planning materials requirement (EOQ , Inventory levels and reserve stocks)
  • Materials control (Principles and Methods)
/ Ch 7,8, Book 1 / A
Labour Costing, Control and Accounting:
  • Productivity and efficieny of labour.
  • Remuneration Methods (Straight piece rate, differential piece rate, Incentive wage plans)
  • Learning curve theory
  • Organisation for labour cost accounting and control
  • Accounting for labor related costs (Overtime, Bonus payments, vacation pay, guaranteed annual wage plans , apprenticeship and training programs, pension
  • Labor related deductions
/ Ch 9,10, Book 1 / A
Factory Overhead Costing and Control:
  • Nature of factory overhead.
  • Procedure of factory overheads including allocation, apportionment, reapportinment and absorption.
  • Repeated distribution and algebric method for reciprocal, service department costs.
  • Calculation and use of Predetermined factory overhead rate.
  • Applied and actual FOH, under /overapplied FOH.
/ Ch 12,13,Book 1 / B
Types of Costing Systems:
  • Establishment of Cost Accounting system
  • Principles of double entry system of costing, integrated and interlocking cost accounts..
  • Job costing and batch costing.
  • Process Costing – Cost of Production Report
  • Process Costing – Average and FIFO method
  • Joint product and by-product.
  • Service Costing
/ Ch 2,3,4Book 3
Ch 4,5,6, Book 1 / B

Recommended Text

  1. Matz, Hammer Usry (1985) 9th edition Cost Accounting South-western Publishing Co
  2. Garrison H. Ray, Noreen W. Eric (2004) 10th edition Managerial Accounting, Irwin publishers

Further Readings

  1. Hilton W. Ronald (2005) Managerial Accounting6th edition McGraw-Hill Irwin
  2. Jain S.P, Narang .K.L 2000 Advanced Cost Accounting, Kalyani Publishers