In the Name of God, Most Gracious, Most Merciful
JORDAN UNIVERSITY OF SCIENCE AND TECHNOLOGY
FACULTY OF MEDICINE
DEPARTMENT OF HEALTH ADMINISTRATION
COURSE SYLLABUS
SECOND SEMESTER 2008/2009
COURSE:
Title: Costing of Health Services
Code: HSA315
Line Number: 113150
Instructor: Dr. Asma Assaf
Class Time: Section (2) – 2:15-3:45 (Room: C3015)
Office Hours: 10-11 on Tuesday , Wednesday and Thursday or by appointment
Office No. E-413 (Yarmouk University - Faculty of Economics)
Office Phone No. Yarmouk University: 02-7211111 – Extension 3037
E-mail:
Prerequisites: HSA151 (Principles of Business Administration)
Credit Hours: 3 Credit hours.
IMPOTRATNT DATES:
26, Feb.2009: Last day to delete the (incomplete) note for students who got the notifaction on the First Semester.
10, May.2009: End of Drop Period.
COURSE DESCRIPTION:
This course introduces the student to the tools and techniques of cost accounting in the complex and challenging environments of the health care field, by considering product costing, cost allocation, cost-volume profit analysis and other important topics and issues.
SPECIFIC COURSE OBJECTIVES:
Upon completion of this course, the student will be able to:
1) Understand cost terms, concepts, classifications and allocation.
2) Become more aware of cost accounting techniques and tools used in decision making for health care entities.
3) Strengthen his understanding of relevant costs for profit planning and capital budgeting decisions.
4) Work on developing certain other individual skills and abilities that many of today’s health administation graduates need to enhance. These include the ability to communicate, learning how to cope with complex situations that do not have a single “right” answer, exercising imagination and creativity, teaching yourself new subjects (in preparation for life-long learning), making judgments, and becoming more aware of the international markets in which you will live and be working.
LEARNING OUTCOMES:
After completing this course the student must demonstrate the knowledge and ability about:
1. Cost terms, concepts, and classifications.
2. Systems design: Job-Order costing.
3. Service department allocations.
4. Cost behavior: Analysis and Use.
5. Cost-Volume-Profit Relationships.
6. Activity-Based costing: A tool to aid decision making.
7. Profit planning.
8. Relevant costs for decision making.
9. Capital budgeting decisions.
10. Pricing products and services.
COURSE MATERIALS:
Required Textbook: Garrison, Noreen and Brewer, Managerial Accounting, McGraw-Hill International Edition, 12th edition.
Textbook Web Page:On-line tutors and quizzes are available at Garrison, Noreen and Brewer, Managerial Accounting, McGraw-Hill International Edition, 12th edition textbook website:
www.mhhe.com/garrison12e
ASSESSMENT:
First Exam / 25 points 15/3-26/3: Chapters 2,3 &b 4ASecond Exam / 25 points 26/4- 7/5: Chapters 5, 6 & 8
Attendance, Participation and Assignments / 10 points
Final Exam / 40 points 7/6- 15/6 : All chapters
Total / 100 points
ADDITIONAL INFORMATION
· PARTICIPATION: It has been my experience that it is difficult to do well in this class without your regular attendance and active participation. You are expected to come to class (1) having read the assigned chapter and (2) having completed all assigned homework.An integral part of any successful business career is the ability to communicate ideas effectively. Since the classroom is one of the easiest forums in which to cultivate this talent, participation in classroom discussions is required and expected.
· EXAMINATIONS: Student will be examined in theory and its application. Exam questions may consist of multiple choice short problems, True or false and short answer questions. You are responsible for all material covered in the text, readings, homework, or lectures.
No make-up exams will be given. Grade related to excused absences at mid term exams will be added to the final exam. A student must submit in writing to the instructor concerned the reasons for the absence no later than three days as of the resumption of attendance otherwise the absence will be considered as unexcused absence. Unexcused absences result in grade of zero for that particular exam. Cheating is grounds for immediate class failure.
. IN-CLASS ASSIGNMENTS : This is in class assignments that will be issued during the semester. All assignments will count 10 points for participation and attendance.
TOPICS TO BE COVERED DURING 2009:
Week -1: (15/2 – 19/2)
Course introduction: Syllabus
Week -2: (22/2 – 26/2)
Chapter 2: LO1:Cost terms, concepts, and classifications.
· LO1.1: Identify and give examples of each of the three basic manufacturing cost categories.
· LO1.2: Distinguish between product costs and period costs and give examples of each.
· LO1.3: Understand the differences between variable costs and fixed costs.
· LO1.4: Understand the differences between direct and indirect costs.
· LO1.5: Define and give examples of cost classifications used in making decisions: differencial costs, opportunity costs, and sunk costs.
Week -3: (1/3 – 5/3)
Holiday : 5/3 Tursday, Birth of Prophet Mohammad (Peace be upon him)
Chapter 2: LO1:Cost terms, concepts, and classifications.
· LO1.6: Prepare an income statement including calculation of the cost of goods manufactured.
· LO1.7: Properly account for labor costs associated with idle time, overtime, and fringe benefits.
Class Work: (Exercises:2-1, 2-2, 2-3, 2-5, 2-6, 2-7 and 2-24)
Week -4: (8/3 – 12/3)
Chapter 3: LO2: Systems Design: Job-Order costing and Process costing
· LO2.1: Destinguish between process costing and job-order costing and identify companies that would use each costing method.
· LO2.2: Compute predetermined overhead rates and explain why estimated overhead costs are used in the costing process.
· LO2.3: Understand the flow of costs in a job-order costing system.
Class Work: (Exercises:3-1, 3-2, 3-3, and 3-5)
Chapter 4(Appendix 4B): LO3: Service Department Allocations
· LO3.1: Allocate service department costs to operating departments using the direct method.
· LO3.2: Allocate service department costs to operating departments using the step-down method.
Class Work: (Exercises:4-8, 4-9, and 4-23)
Weeks -5&6: (15/3 – 26/3)
First Exam Period: Chapters required: 2,3&4A
Week -7: (29/3 – 2/4)
Chapter 5: LO4: Cost behavior analysis and use
· LO4.1: Understand how fixed and variable costs behave and how to use them to predict costs.
· LO4.2: Use a scattergraph plot to diagnose cost behavior.
· LO4.3: Analyze a mixed cost using the high-low method.
· LO4.4: Prepare an income statement using the contribution format.
Class Work: (Exercises:5-1, 5-2, 5-3, 5-4 , 5-12 and Problem 5-18)
Chapter 6: LO5: Cost-Volume-Profit relationships
· LO5.1: Explain how changes in activity affect contribution margin and net operating income.
· LO5.2: Prepare and interpret at cost-volume-profit (CVP) graph.
· LO5.3: Use the contribution margin ratio (CM ratio) to compute changes in contribution margin and net operating income resulting from changes in sales volume.
· LO5.4: Show the effects on contribution margin of changes in variable costs, fixed costs, selling price, and volume.
· LO5.5: Compute the break-even point in unit sales and sales dollars.
Class Work: (Exercises:6-1, 6-2, 6-3, 6-4 and 6-5)
Week -8: (5/4 – 9/4)
Chapter 6: LO5: Cost-Volume-Profit relationships
· LO5.6: Determine the level of sales needed to achieve a desired target profit.
· LO5.7: Compute the margin of safety and explain its significance.
· LO5.8: Compute the degree of operating leverage at a particular level of sales and explain how it can be used to predict changes in net operating income.
· LO5.9: Compute the break-even point for a multiproduct company and explain the effects of shifts in the sales mix or contribution margin and the break-even point.
Class Work: (Exercises:6-6, 6-7, 6-8, 6-9 and Case 6-33)
Week -9: (12/4 – 16/4)
Chapter 8: LO6: Activity-Based Costing: A tool to aid decision making
· LO6.1: Understand activity-based costing and how it differs from a traditional costing system.
· LO6.2: Assign costs to cost pools using first-stage allocation.
· LO6.3: Compute activity rates for cost pools.
· LO6.4: Assign costs to a cost object using a second-stage allocation.
· LO6.5: Use activity-based costing to compute product and customer margins.
Class Work: (Exercises:8-1, 8-2, 8-3, 8-4, and 8-5)
Week -10: (19/4 – 23/4)
Chapter 9: LO7: Profit Planning
· LO7.1: Understand why organizations budget and the processes they use to create budgets.
· LO7.2: Prepare a sales budget, including a schedule of expected cash collections.
· LO7.3: Prepare a selling and administrative expense budget.
· LO7.4: Prepare a cash budget.
· LO7.5: Prepare a budgeted income statement.
· LO7.6: Prepare a budgeted balance sheet.
Class Work: (Exercises:9-1, 9-6, 9-7, 8-4, and Problem 9-21)
Weeks - 11&12 : (26/4 – 7/5)
Second Exam Period: Chapters required: 5,6 & 8
Holiday: 1/5 Friday, Labor Day
Week -13: (10/5 – 14/5)
Chapter 13: LO8: Relevant costs for decision making
· LO8.1: Identify relevant and irrelevant costs and benefits in a dicision.
· LO8.2: Prepare an analysis showing whether a product line or other business segment should be dropped or retained.
· LO8.3: Prepare a make or buy analysis.
· LO8.4: Prepare an analysis showing whether a special order should be accepted.
Class Work: (Exercises:13-1, 13-2, 13-3, 13-4, and Case 13-26)
Week -14: (17/5 – 21/5)
Chapter 14: LO9: Capital budgeting decisions
· LO9.1: Rank investment projects in order of preference.
· LO9.2: Determine the payback period for an investment.
· LO9.3: Compute the simple rate of return for an investment.
Class Work: (Exercises:14-4, 14-5, 14-6, Problem 14-23 and 14-26)
Week -15: (24/5 – 28/5)
Holiday: 25/5 Monday, Independence Day
Appendix A: LO10: Pricing Products and Services
· LO10.1: Compute the profit-maximizing price of a product or service using the price elasticity of demand and variable cost.
· LO10.2: Compute the selling price of a product using the absorption costing approach.
· LO10.3: Compute the target cost for a new product or service.
Class Work: (Exercises:A-1, A-2, A-3, Problem A-4, A-5 and A-8)
Week -16: (31/5 – 4/6)
Review of material covered during the semester
Weeks -17&18: (7/6 – 15/6)
FINAL EXAM: Determined according to final exam schedule prepared by Registration Department and include all chapters covered during the course
GOOD LUCK
Dr. Asma Assaf