65%文字 35%计算
Lecture 1
Management accounting is used to provide financial information for internal use by managers
for decision-making, planning and control.
Management accounting is the sourcing, analysis, communication, and use of decision-relevant
financial and non-financial information to generate and preserve value of organizations
From ‘ bean counters’ (善于计算的人) to ‘business partners’（商业伙伴）--- Expansionary
trends: from financial to non-financial, from costing to business analytics, from operational
to strategic, from businesses to organizations.
Business partner (advisory accounting): works in cross-functional teams; can be ‘front-office’;
internal and external focus; contributes to definition of goals; can move from technical details to
broader strategic issues; output=interpretation of numbers, bigger picture; ad-hoc information;
quantitative and qualitative skills; financial and non-financial expertise
Strategic management accounting
- issue ： Management accounting is deemed irrelevant and has relevant losses because it is
subservient to financial accounting.
---- Backward-looking (reporting past information) and inward-looking (lack of relevant
market information)
---- Short-term oriented (emphasis on quarterly reports)
---- Providing distorted information (unsophisticated costing system): There are different
methods for classifying and calculating costs, which embed different
assumptions.
---- To focus on financial number (unable to capture sources of long-term value and
competitiveness)
---- Unable to give right incentives to managers
Need to be forward looking and to help cope with unpredictable futures
- 是什么：The provision and analysis of financial and non-financial information about a firm’s
products, markets, and its competitors’ costs, and the monitoring of the enterprise’s strategies
and those of its competitors in these market over a period of time
Lecture 2 Cost classification and income reporting methods
考点 1. Cost classification
Variable cost & Fixed cost
Direct cost (prime cost) & Indirect cost (overhead)
Production cost & non-production cost (financial cost, selling & distribution cost, research &
development cost etc.)
Material, Labour, Expense
考点 2 Absorption costing 吸收成本法& Variable costing ---如何将成本展现在利润表里
两个方法的区别在于 fixed manufacturing overhead 划分为不同, 在 absorption costing 中是
按卖多少来算 (recognized when goods are sold)，而 variable costing 中是按当期生产多少来算
(recognized when costs incurred)
The difference between this two-method profit.
Inventory changes * OAR per unit
Profit reconciliation: The difference can be explained by the change in inventory of two
, goods.
Under absorption costing, any increase in inventory carries a portion of fixed manufacturing
overheads which, instead of being expensed in that period (as it would under variable costing), is
inventoried and becomes a current asset on Balance Sheet. It will be recognized in subsequent
period when those units are sold.
Conversely, a decrease in inventory would mean that we sell all we produce plus some goods in
inventory; we will recognize all fixed manufacturing overheads for this period plus portion of
fixed manufacturing overheads accumulated in inventory released from earlier periods.
Absorption costing 优缺点：
ADVANTAGE: 1. Required for financial reporting purposes
2. Give a fuller picture of product costs
DISADVANTAGE: 1. Unitized fixed costs spreading them on volume ------ inaccurate
2. Hide fixed overheads in inventory
Variable costing 优缺点
ADVANTAGE: 1. Avoid unitized fixed costs
2. Highlights contribution margin
3. More transparent about overheads incurred (does not hide some in inventory)
DISADVANTAGE: 1. Cannot be used in external reporting
2. Only provide partial picture of product costs
Lecture 3 Traditional costing system vs. activity-based costing & Lecture 4 The limits of
ABC and Activity-based management
考点 3 Activity-based costing
Traditional costing = Absorption costing
步 骤： 1. Assign the overheads to production and service cost centers 2. The total cost of the
service centers is appointed to other service centers who use theirs service, and to the production
centers so that all overheads end up in production centers 3. The total amount of each
production center is divided by some measure of activity to derive the overhead absorption rate
Limitations (缺点)
1. Allocation bases are always approximate, and often inaccurate
2. Absorption costing was not designed for automated technological environments. Where:
manufacturing overheads are often much bigger than direct costs & non-manufacturing
overheads have increased as proportion of manufacturing overheads.
3. Overhead Absorption Rates are crude devices for allocating overheads: different OAR bases
give different answers.
4. Cost distortion under traditional absorption costing: TAC tends to allocate indirect costs
to products in ways that do not reflect resource consumption and activity usage. Thus,
products produced in large volume (often standard, mass production) will receive most of
indirect costs ----> over-cost. Products produced in small volume (often more complex,
specialty products) will under-cost. ----> mislead product mix and pricing decisions
Activity-based costing
Activity---- Cost pool ---- Cost diver ---- Cost Diver Rate
- The process: 1. Identify the different activities of business 2. Create cost pools by calculating
the total cost of each activity 3. Identify a cost driver for each activity 4. Calculate the cost
Lecture 1
Management accounting is used to provide financial information for internal use by managers
for decision-making, planning and control.
Management accounting is the sourcing, analysis, communication, and use of decision-relevant
financial and non-financial information to generate and preserve value of organizations
From ‘ bean counters’ (善于计算的人) to ‘business partners’（商业伙伴）--- Expansionary
trends: from financial to non-financial, from costing to business analytics, from operational
to strategic, from businesses to organizations.
Business partner (advisory accounting): works in cross-functional teams; can be ‘front-office’;
internal and external focus; contributes to definition of goals; can move from technical details to
broader strategic issues; output=interpretation of numbers, bigger picture; ad-hoc information;
quantitative and qualitative skills; financial and non-financial expertise
Strategic management accounting
- issue ： Management accounting is deemed irrelevant and has relevant losses because it is
subservient to financial accounting.
---- Backward-looking (reporting past information) and inward-looking (lack of relevant
market information)
---- Short-term oriented (emphasis on quarterly reports)
---- Providing distorted information (unsophisticated costing system): There are different
methods for classifying and calculating costs, which embed different
assumptions.
---- To focus on financial number (unable to capture sources of long-term value and
competitiveness)
---- Unable to give right incentives to managers
Need to be forward looking and to help cope with unpredictable futures
- 是什么：The provision and analysis of financial and non-financial information about a firm’s
products, markets, and its competitors’ costs, and the monitoring of the enterprise’s strategies
and those of its competitors in these market over a period of time
Lecture 2 Cost classification and income reporting methods
考点 1. Cost classification
Variable cost & Fixed cost
Direct cost (prime cost) & Indirect cost (overhead)
Production cost & non-production cost (financial cost, selling & distribution cost, research &
development cost etc.)
Material, Labour, Expense
考点 2 Absorption costing 吸收成本法& Variable costing ---如何将成本展现在利润表里
两个方法的区别在于 fixed manufacturing overhead 划分为不同, 在 absorption costing 中是
按卖多少来算 (recognized when goods are sold)，而 variable costing 中是按当期生产多少来算
(recognized when costs incurred)
The difference between this two-method profit.
Inventory changes * OAR per unit
Profit reconciliation: The difference can be explained by the change in inventory of two
, goods.
Under absorption costing, any increase in inventory carries a portion of fixed manufacturing
overheads which, instead of being expensed in that period (as it would under variable costing), is
inventoried and becomes a current asset on Balance Sheet. It will be recognized in subsequent
period when those units are sold.
Conversely, a decrease in inventory would mean that we sell all we produce plus some goods in
inventory; we will recognize all fixed manufacturing overheads for this period plus portion of
fixed manufacturing overheads accumulated in inventory released from earlier periods.
Absorption costing 优缺点：
ADVANTAGE: 1. Required for financial reporting purposes
2. Give a fuller picture of product costs
DISADVANTAGE: 1. Unitized fixed costs spreading them on volume ------ inaccurate
2. Hide fixed overheads in inventory
Variable costing 优缺点
ADVANTAGE: 1. Avoid unitized fixed costs
2. Highlights contribution margin
3. More transparent about overheads incurred (does not hide some in inventory)
DISADVANTAGE: 1. Cannot be used in external reporting
2. Only provide partial picture of product costs
Lecture 3 Traditional costing system vs. activity-based costing & Lecture 4 The limits of
ABC and Activity-based management
考点 3 Activity-based costing
Traditional costing = Absorption costing
步 骤： 1. Assign the overheads to production and service cost centers 2. The total cost of the
service centers is appointed to other service centers who use theirs service, and to the production
centers so that all overheads end up in production centers 3. The total amount of each
production center is divided by some measure of activity to derive the overhead absorption rate
Limitations (缺点)
1. Allocation bases are always approximate, and often inaccurate
2. Absorption costing was not designed for automated technological environments. Where:
manufacturing overheads are often much bigger than direct costs & non-manufacturing
overheads have increased as proportion of manufacturing overheads.
3. Overhead Absorption Rates are crude devices for allocating overheads: different OAR bases
give different answers.
4. Cost distortion under traditional absorption costing: TAC tends to allocate indirect costs
to products in ways that do not reflect resource consumption and activity usage. Thus,
products produced in large volume (often standard, mass production) will receive most of
indirect costs ----> over-cost. Products produced in small volume (often more complex,
specialty products) will under-cost. ----> mislead product mix and pricing decisions
Activity-based costing
Activity---- Cost pool ---- Cost diver ---- Cost Diver Rate
- The process: 1. Identify the different activities of business 2. Create cost pools by calculating
the total cost of each activity 3. Identify a cost driver for each activity 4. Calculate the cost
