ACCOUNTING FOR MANAGEMENT

I Semester: MBA
Course Code Category Hours / Week Credits Maximum Marks
L T P C CIA SEE Total
CMBC02 Core
3 1 - 4 30 70 100
Contact Classes: 45 Tutorial Classes: 15 Practical Classes: Nil Total Classes: 60
I. COURSE OVERVIEW:
Financial statements are very useful to the business concerns to interpret and analyse the financial
growth of different companies. The course focuses on the objectives and importance of financial
accounting, accounting concepts, accounting conventions, method of recording transactions under
double entry system, accounting process like journal, ledger, trial balance and final accounts that
enable students to understand earning position and financial position of business concern. This
course includes appreciate and use financial statements as means of business communication. This
course uses the analytical techniques of inventory valuation, funds flow and cash flow statements.

II. COURSE OBJECTIVES:

The students will try to learn:
I. The principles of accounting and utilization of financial information for decision making and
forward planning for future.
II. Financial statements for knowing earning capacity and financial position of the business
concern with confidence
III. The inventory valuation of different companies and make analysis of financial accounts.
IV. The significance of financial statements as means of business communication.
V. Analytical techniques and conclusions from financial information for the purpose of decision
making.

III. COURSE OUTCOMES:

After successful completion of the course, students will be able to:
CO 1: Demonstrate and elucidate the objectives, types and principles of accounting to prepare
proper books of records as per GAAP.
CO 2: Discuss different accounting concepts and conventions, and its importance for better
recording of accounting cycle
CO 3: Describe the significance and preparation of pre and final accounts with adjustments to
communicate the accounting information
CO 4: Recognize the causes of depreciation and methods of charging depreciation on fixed
assets to measure its impact on business accounting
CO 5: Summarize the objectives, significance and valuation methods of inventory and
goodwill for progressive allocation of resources
CO 6: Illustrate the features, significance and classification of shares and debentures to
maintain records for issue of shares at par and discount
CO 7: Evaluate the influencing factors of working capital management to show the difference
between cash profits and book profits
CO 8: Summarize the cash flow and funds flow statements for excel analysis of funds from
operations
CO 9: Demonstrate the importance, limitations and types of financial statements to find the
financial soundness of the firm
CO 10: Examine various ratios on financial statements for standardizing the accounting
information

IV. SYLLABUS:

UNIT-I INTRODUCTION TO ACCOUNTING Classes: 08

Definitions, meaning, Importance, limitations, objectives, functions of financial accounting and
classification of accounts, principles of accounts, accounting concepts and conventions, the

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generally accepted accounting principles (GAAP), their implications on accounting system;
advantages and limitations of double entry system, accounting cycle.
UNIT-II THE ACCOUNTING PROCESS Classes:10
Books of original record: journal and subsidiary books, ledger, trial balance, final accounts with
adjustments: Methods of depreciation: Meaning, definitions, causesof depreciation, methods of
depreciation like fixed installment method, diminishing balance method, annuity method and
depreciation fund method (simple problems).
UNIT-III INVENTORY VALUATION Classes: 09
Meaning, objectives of inventory valuation, methods, merits and demerits of inventory valuation
methods like FIFO method, LIFO method, weighted average method, simple average method
(problems).
Issue of shares: entries for issue of shares at par, issue of shares at discount and premium, calls in
arrears, forfeiture of shares, reissue of forfeiture of shares (problems).
UNIT-IV FINANCIAL ANALYSIS Classes:09
Meaning, definitions, significance, limitations of funds flow and cash flow statements, Statement
showing changes in working capital, funds from operations, distinction between funds flow and
cash flow statements, funds flow and income statement, funds flow and balance sheet, cash profits
and book profits; preparation and analysis of funds flow statement and cash flow statement
(problems).
UNIT-V FINANCIAL STATMENTS AND RATIO ANALYSIS Classes: 09
Analysis and interpretation of financial statements from investor and company point of view,
horizontal analysis and vertical analysis of company financial statements; meaning, definitions,
significance and limitations of ratio analysis; types of ratios like liquidity, leverage, solvency
and profitabilityratios(problems).
Text Books:
1. Paresh Shah, “Financial Accounting for Management”, Oxford University Press, 3rdEdition,
2019.
2. Prter& Norton, “Financial Accounting”, Cengage publications, 9thEdition, 2017.
3. N.Ramachandran, “Financial Accounting and Analysis” Tata McGraw-Hill Publishing Limited,
3rdEdition, 2015.
4. S.N.Maheswari, “Financial Accounting”, IBH Publications, 7thEdition, 2015.
5. Maheshwari S. N., and Maheshwari S. K., "Accounting for Management", Vikas Publishing
House, 3rdEdition, 2014.
6. S Ramanathan, “Accounting for Management”, Oxford University Press, 1stEdition, 2014.
7. Narayana Swamy, “Financial Accounting and Analysis” PHI Publications, 2ndEdition, 2012.
8. Narayana Swamy R, “Financial Accounting: A Management Perspective”, Prentice Hall of
India, Delhi, 4thEdition, 2011.
9. Jelsy Josheph Kuppapally, “Accounting for Managers”, Prentice Hall of India, Delhi, 1stEdition,
2010.
10. S.P.Jain and K.L.Narang, “Financial Accounting” Kalyani Publishers, 10threvised Edition,2010.
11. S.P.Jain and K.L.Narang, “Cost & Management Accounting”, Kalyani Publishers, 10th revised
Edition, 2010.
12. Shashi.K.Gupta and R.K.Sharma, “Advanced Management Accounting” Kalayani publishers,
2nd revised Edition,2003.
Reference Books:
1. V.Rajasekharam “Financial Accounting and Analysis” Pearson Education, 13thEdition,2012.
2. Ranjan Kumar Bai: “Financial Accounting and Analysis”, S.Chand, 1st revised Edition,2012.
3. S.N.Maheswari and S.K.Maheswari, “Financial Accounting”, Vikas publications,
4thEdition,2009.
4. Hanif and Mukarjee, "Financial Accounting", Tata McGraw Hill Ltd., 2ndEdition,2011.
5. Tulsian P.C., "Financial Accounting", Pearson Education, Revised 1stEdition,2013.
Web References:

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1. http://www.koledza.lv/best/download/biblioteka/Financial_Accounting.pdf.
2. http://www.tutorialspoint.com/accounting_basics/accounting_basics_tutorial.pdf.
E-Text Books:
1. http://www.free-management-ebooks.com/skills-finance.html.
2. http://www.amazon.com/Financial-Reporting-Analysis-Lawrence-Revsine-
book/dp/B005KLBRDS.