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The document outlines the course materials for Managerial Accounting (MACC 423) as part of the Bachelor of Science in Office Management program at Bulacan Polytechnic College. It includes a list of modules, specific learning objectives, topics covered, assessment methods, and references. The focus is on understanding cost behavior patterns, including fixed and variable costs, and their significance in managerial decision-making.

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0% found this document useful (0 votes)
2 views

Module

The document outlines the course materials for Managerial Accounting (MACC 423) as part of the Bachelor of Science in Office Management program at Bulacan Polytechnic College. It includes a list of modules, specific learning objectives, topics covered, assessment methods, and references. The focus is on understanding cost behavior patterns, including fixed and variable costs, and their significance in managerial decision-making.

Uploaded by

playmakermaker21
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Program : BACHELOR OF SCIENCE IN

OFFICE MANAGEMENT

Course Code : MACC 423

Course Title : MANAGERIAL ACCOUNTING

Course Credit : 3 units Contact Hours : 54

BULACAN POLYTECHNIC COLLEGE


Bulihan, City of Malolos
Managerial Accounting
MODULE MATERIALS

List of Modules

No. MODULE
MODULE TITLE
CODE

1 Introduction to Managerial Accounting MACC 423-1

2 Controllership MACC 423-2

3 Managerial Accounting As A Career MACC 423-3

4 Managerial Cost Concepts MACC 423-4

5 Costs & Margin Concepts MACC 423-5

6 Cost Behavior Analysis MACC 423-6

7 Estimating Cost Behavior MACC 423-7

8 Cost-Volume-Profit (CVP) Analysis MACC 423-8

9 Job Order Costing & Process Costing MACC 423-9

10 Budgetary Planning-Strategy & The Master Budget MACC 423-10

11 Statement of Cash Flows MACC 423-11

12 Financial Statements Analysis MACC 423-12

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 2 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
MACC 423-6
Cost Behavior Analysis

MODULE MATERIALS

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 3 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
COST BEHAVIOR
ANALYSIS
(MACC 423-6)

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 4 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
MODULE CONTENT
COURSE TITLE: Managerial Accounting

MODULE TITLE Cost Behavior Analysis

NOMINAL DURATION: 3 Hours

SPECIFIC LEARNING OBJECTIVES:


At the end of this module you MUST be able to:
1. Understand the nature of various cost behavior patterns.
2. Explain the significance of relevant range.
3. Understand the concept of mixed costs.

TOPICS: (Sub-Topics)
1. Cost Behavior
2. Nature of Fixed and Variable Costs
3. Relevant Range
4. Mixed Costs
5. Importance of Identifying Variable & Fixed Costs
6. Engineered, Committed, and Discretionary Costs
ASSESSMENT METHOD/S:
Quiz-Multiple Choice
REFERENCE/S:
1. Cabrera, Ma. Elenita Balatbat
Management Accounting-Concepts and Applications,
2017 Edition
Manila: GIC Enterprises
2. A) Mejorada, N.D.
Introduction to Management Accounting, 2018 Edition
Makati City: Goodwill Trading Co., Inc.
3. A) Sollenberger and Schneider
Managerial Accounting, 9th Edition 2016
Hoboken, New Jersey, USA: John Wiley and Sons
B) Homgren, Sundem and Stratton
Introduction to Management Accounting 10th Edition, 2017
Upper Saddle River, New Jersey, USA: Pearson Prentice Hall
C) Engler, Calvin
Managerial Accounting, 3rd Edition
Irwin, Homewood, Illinois 60430
Boston, MA, USA 02116
4. Vicente, Ma. Violeta V.
Cost Accounting & Cost Management, 2016 Edition
Mutual Books Inc. Distributors & Publishers
Mandaluyong City, M.M. 1552
5. www.slideshare.net

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 5 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Information Sheet
MACC 423-6
Cost Behavior Analysis

Learning Objectives:
After reading this INFORMATION SHEET, YOU MUST be able to:
1. Know the importance of identifying variables costs from fixed costs.
2. Understand and apply engineered, committed and discretionary costs.

INTRODUCTION

According to economic theory, marginal cost-the cost to produce one


additional unit-does not increase in proportion to production or in a straight line
when plotted on a graph. Rather, it increases disproportionately or as a curve on
a graph. For example, consider the case of a furniture maker that is too small to
afford automated equipment. If the company has only one employee, he would
more likely perform some of the cutting, planning, and sandpapering by hand.
Fixed and variable costs will be discussed in this module to determine their
importance and behavior in a relevant range.
COST BEHAVIOR
The way a cost reacts to a change in business activity
It is essential for managers to understand cost behavior patterns if they
are to accurately predict how a cost will react to a contemplated change in
business activity
The failure to project cost effects when making decisions or incorrect
projections may have serious consequences for a firm
NATURE OF FIXED & VARIABLE COSTS
Activity base
An item or event that has cause and effect relationship with the incurrence
of a variable cost
Variable cost may be measured in terms of activity base

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 6 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Types of Cost Behavior Patterns
Summary of Variable & Fixed Cost Behavior
Cost In Total Per Unit
Variable Total variable cost is directly Variable cost per unit
proportional to the activity remains constant or the
level within the relevant same over wide ranges of
range activity
Fixed Total fixed cost remains the Fixed cost per unit goes
same or constant even when down as activity level goes
the activity level changes up.
within the relevant range

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 7 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Bulacan Date Developed:
Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 8 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
RELEVANT RANGE
A firm will choose a span of activity levels near its optimal level
A firm usually operates within its relevant range, although production may
occasionally vary from its norm

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 9 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Bulacan Date Developed:
Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 10 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
MIXED & ENGINEERED COSTS

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 11 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
The Analysis of Mixed Cost Methods
1) Account Analysis
2) Engineering Approach
3) High-Low Method
4) Scattergraph Method
5) Least-Square Regression Method
Bulacan Date Developed:
Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 12 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
1. Variable cost per unit = Change in cost = 3,600/4,000 = Euro0.90
Change in unit
2. Fixed cost in total = Total cost – Total variable cost
= 9,700 – (0.90 * 9,000 units)
= 9,700 – 8,100 = Euro1,600
3. Total cost = Fixed cost + Variable cost (Y = a + bX)
Y = Euro1,600 + Euro0.90X
Example Problems

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 13 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Bulacan Date Developed:
Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 14 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Bulacan Date Developed:
Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 15 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Bulacan Date Developed:
Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 16 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
Bulacan Date Developed:
Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 17 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423
IMPORTANCE OF IDENTIFYING VARIABLE & FIXED COSTS
These costs were explored and identified because their behavior patterns
affect many managerial decisions such as:
a) Setting of selling prices
b) Entering into new markets
c) Introducing new products
d) Eliminating existing products
e) Investing in additional and/or replacement plant facilities
f) Curtailing activity
g) Reaching make or buy decisions

COMMITTED & DISCRETIONARY COSTS

Bulacan Date Developed:


Bachelor of Science in February 2021
Office Management Polytechnic Date Revised: Page 18 of 18
College
Managerial Accounting
Document No. Developed by:
MACC 423 Eugene A. Ruano Revision # 02
30- MACC 423

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