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  1. 1. ON-LINE SYLLABUS BUSN 631: ACCOUNTING FOR MANAGERS (V1.0, 12/23/02) Course: BUSN 631— Accounting For Managers Sections/Locations: VA Beach Campus, No. VA Campus, Distance Term: Spring 2003 Credit Hours: 3 VA Beach Schedule/Location: Tuesdays, 6:00 pm – 9:00 pm, CRB 237 No. VA Schedule: Saturdays— 1/18, 2/08, 2/22, 3/08, 3/22, 4/05 Course Description: Management accounting information is key to achieving corporate strategy because it facilitates sound managerial decision-making, the development of rational plans, and the proactive measurement, control and encouragement of desired outcomes. This is the basic thrust of BUSN 631. The course consists of three modules: financial statement interpretation and analysis, strategic cost management, and performance measurement and control. Topics include financial statements, activity-based cost management systems, cost-volume-profit analysis, pricing, capital budgeting, the balanced scorecard, incentive systems, budgeting and EVA. Importantly, the course emphasizes concepts and tools necessary for sound decision-making, planning, and measurement and control rather than technical aspects of financial statement preparation. Professors: pix Professor: George S. Babbes, Ph.D. Sections: VA Beach Campus, Distance Email: georbab@regent.edu Office: 757-226-4837 Fax: 757-226-4369 Office Hours: Wed & Sat 3:30-4:30, and by appointment Sat 2:00-3:00 virtual office hour (in Bb Virtual Classroom)
  2. 2. pix Professor: James Bechtel Section: No. Virginia Campus Email: jamebec@regent.edu Office: 703-906-2929 Fax: 703-317-7975 Office Hours: after class or by appointment A Personal Note from Your Professors: Accounting is often called the “language of business” because it is the principal information system organizations use for measuring and communicating performance data; both internally to facilitate sound decision making, planning, and management control, and externally to share information with lenders, investors, government, auditors and the like. Generating accounting information primarily for internal purposes, called management accounting, is necessary for monitoring the efficiency and effectiveness of operations. There are virtually no “rules” to follow in management accounting. Instead, the key objective is to identify and precisely measure key business drivers to aid management in strategically managing and controlling the enterprise. An effective management accounting system will provide accurate and timely information to help understand the cost of products and services, structure and plan of activities, measure and control performance, and encourage desired behavior. Generating accounting information primarily for external purposes, called financial accounting, is required to help external stakeholders make informed economic decisions. To facilitate the interpretation of financial reports, there are many “rules” to follow. Emphasis will be on interpreting and analyzing financial statements, not on technical aspects of their preparation. Some business school students naively believe that they can leave all the “accounting” to others. Don’t make this mistake. The principles covered in BUSN 631 have as much to do with corporate strategy as accounting per se, they are not merely tools for the specialist. For example, without being able to quickly and accurately measure the costs of products and services, rationally plan activities, and precisely measure, monitor and reward performance, it would be virtually impossible to become a successful leader in consulting, marketing, not-for-profit or for- profit general management, strategic planning or operations, let alone accounting or finance. Strategic use of accounting information makes for good leaders and is the cornerstone of consistently good decision-making. Don’t be under the illusion this can be relegated to others. Course Goals/Competencies: The goal of BUSN 631 is to help prepare students to rigorously analyze complex business school cases, and ultimately real-world business dilemmas, by achieving a basic competence in: (1) financial statement interpretation and analysis; (2) strategic cost management; and (3) performance measurement and control. A key emphasis will be to help students recognize that management accounting information is key to achieving corporate strategy because it facilitates 2
  3. 3. sound managerial decision making, the development of rational plans, and the proactive measurement, control and encouragement of desired outcomes. Course Learning Objectives: Module 1: Financial Statement Interpretation and Analysis— learn the basics of preparing the balance sheet, the income statement, and the statement of cash flows; learn to analyze financial statements to determine the health of a business; learn to appreciate the complexity of accounting rules and to evaluate the quality of financial reporting. Module 2: Strategic Cost Management— learn to link cost management to corporate strategy by recognizing the important role of precise measurement in sound managerial decision making; learning topics include total quality, value chain analysis, cost-volume-profit analysis, traditional cost management systems vs. activity-based cost management systems, pricing, capital budgeting, sensitivity analysis, target costing, life-cycle costing, Kaizen costing and benchmarking. Module 3: Performance Measurement and Control— learn to link performance measurement to corporate strategy by recognizing the foundational role of accounting information in facilitating the management and control of organizations; learning topics include the balanced scorecard, incentive systems, budgeting, variance analysis, responsibility centers, ROI and EVA. Course Resources: Required Resources Title Author(s) ISBN Type Understanding Financial Statements, Fraser and 0-13-027782-7 Textbook sixth edition (2001) Ormiston Management Accounting, third edition Atkinson, Banker, 0-13-010195-8 Textbook (2001) Kaplan, Young Readings in Management Accounting, Young 0-13-021458-2 Readings third edition (2001) The required resources are available through the Regent University Bookstore (http://www.cbamatthews.com/regent/), Prentice Hall, and many on-line booksellers. Companion Website Resource for Textbooks— Both textbooks have companion websites. The companion website to the Fraser & Ormiston text (FO) includes text errata, helpful links, chapter-by-chapter lectures, and chapter-by-chapter quizzes. The companion website to the Atkinson, Banker, Kaplan & Young (ABKY) text includes text errata, helpful links, chapter-by- chapter lectures, chapter-by-chapter quizzes, chapter-by-chapter supplementary articles, and 3
  4. 4. Excel spreadsheets for some of the assigned problems. Students must visit these websites each week to review lecture slides and take quizzes. Understanding Financial Statements (Fraser & Ormiston) companion website address: http://cwx.prenhall.com/bookbind/pubbooks/fraser/ Management Accounting (Atkinson, Banker, Kaplan & Young) companion website address: http://myphlip.pearsoncmg.com/cw/mpbookhome.cfm?vbookid=205 Other Potentially Useful Resources: Self-paced tutorial on basic financial statements: http://www.studyfinance.com/lessons/finstmt/index.html How to analyze a company’s financial statement: http://fisher.osu.edu/~tomassini_1/fanon.html Site for accounting instructors, includes student aids: http://www.swcollege.com/vircomm/gita/gita.html Self-paced tutorial on capital budgeting: http://www.studyfinance.com/lessons/capbudget/index.html Microsoft Excel tutorial: http://www.baycongroup.com/el0.htm Another Excel tutorial: http://www.studyfinance.com/lessons/excel/index.html There are many good links at the textbooks’ companion websites as well. Course Structure & Outline: BUSN 631 is a rigorous and challenging course. For some students, it will be their toughest course in business school. In terms of the typical weekly workload, BUSN 631 students will need to do the following (in this order): (1) carefully study assigned readings; (2) review on-line lecture slides (at text website) to help digest readings; (3) complete end-of-chapter self-tests to confirm understanding; (4) complete on-line self-tests and email your professor no later than Friday (starting 1/3/03); (5) clear-up questions at the 2:00-3:00 ET Sat virtual office hour (in Bb Virtual Classroom); (6) complete and email assignment to your professor no later than noon Monday; (7) post extra credit problems by noon Monday; (8) comment on extra credit and/or assignment problems through Friday; 4
  5. 5. Carefully completing these eight steps will average 10-12 hours per week for most students, more for students with little business experience. Unfortunately, there are no shortcuts. The material is dense and mastery requires attention to detail. It requires a steady discipline to learn accounting; students new to the material will not learn much through cramming. The good news is that mastering this material has a rich payoff, both in subsequent coursework and in real-world decision-making. You’ll find it’s worth the investment! Reading Assignments— Each week, there will be reading assignments consisting of one to three text chapters, plus supplementary articles. These readings are the basis for satisfactorily completing all quizzes, graded assignments and exams. Encouragingly, the materials are state- of-the-art, strategically focused, well illustrated and practical. They are used by both graduate business students and working professionals. Lecture Slides— Lecture slides for each text chapter are available at the texts’ companion websites. These should be reviewed after reading the text to help internalize the key principles and tools covered in the chapter. On-Line Self-Tests (5% of grade)— Each week, students must complete self-tests on the text readings. These tests are fairly basic, but they are useful for confirming understanding. Be prepared when taking these quizzes as this represents a relatively easy way to earn 100% for 5% of the grade. Results must be received by Friday at 11:00 pm (the week before the assignment is due) to receive credit. There will be a five-day grace period for the first week’s quiz (i.e., officially due 1/3 but accepted through 1/8), but the second week’s quiz is due 1/10. To be consistent and fair, no late assignments will be accepted. Students who answer questions incorrectly, but do not understand the reason after seeing the answer, should contact their professor for assistance. Given the increasing complexity of material, it is virtually impossible to catch-up once a student falls behind. Don’t let this happen to you. Students must be especially diligent in their studies to satisfactorily complete this challenging course. Individual Weekly Graded Assignments (30% of grade)— The only way to master the use of accounting concepts and tools is by repeated practice using complex realistic problems. Like becoming proficient at playing the piano or riding a bike, it’s a matter of learning by doing. As such, graded assignments are due each week to provide students an opportunity to practice with the concepts and tools under realistic conditions. Be sure to show all your work. Submit either an excel file or a word file to your professor answering the questions asked and showing all the work required to get to the answer provided. In addition to this syllabus, you will receive an answer sheet for each week that lists specific questions that will total to 100 points. These assignments must be received no later than noon each Monday to receive credit. The first week’s assignment is due 1/6, but there will be a three-day grace period. The second week’s assignment is due 1/13. To be consistent and fair, no late assignments will be accepted. Correcting Assignment to 100% (10% of grade)— Solution excerpts will be posted Monday afternoon. These are not complete solutions, but provide enough information to grade assignments and “connect the dots.” Students may post questions on Bb for additional help correcting assignments to 100%. Don’t by shy, it’s OK to get help on this, work in groups, etc. Be sure to show changes to your original assignment submission (e.g., use a different color so 5
  6. 6. your professor can follow your corrections). Assignments must be corrected to 100% to receive credit (no partial credit). These corrections must be received no later than Wednesday at 11:00 pm. To be consistent and fair, no late assignments will be accepted. Module One and Two Exams (15% each, 30% total)— Examinations will be similar to assigned problems. The exams will be emailed at 5:00 pm Friday. They are due back no later than noon Monday and must reflect a 100% individual effort. Solutions will be posted Monday afternoon. The module one exam will be distributed on 2/7 and the module two exam will be distributed on 3/7. Examinations are open-book, but time-constrained to three hours. Students who have kept up with and understand the readings, self-tests and graded assignments should do well on the exams. The three hour time limit may feel tight, it is important to be prepared. Any student having a conflict with the timing of exams should immediately contact Professor Babbes. Balanced Scorecard Project (20% of grade)— In Chapter 10 of ABKY and the related readings and assignments, we will cover the balanced scorecard. This is a very important tool for the management and control of an organization. Given a focus on both financial and non-financial measures, the balanced scorecard is an especially useful tool for churches and other ministries and nonprofits that manage a dual bottom line. This project requires students to review their church’s published and unpublished strategic documents (e.g., vision statement, mission, core values, programs, etc) and measures (talk to the pastor to see what’s being measured), to put together a well thought-out balanced scorecard (e.g., performance measures that are derived from strategy, based on key drivers and actionable). If your church does not have a strategy, work with the pastor to write one (with the help of what fellow students have collected). Students not attending a church may choose their favorite nonprofit organization instead. In addition to submitting the balanced scorecard, provide the strategic documents, measures, interview notes, etc. that provided the basis for items included in the balanced scorecard. Begin collecting documents now and make an appointment to see your pastor soon. There are three due dates associated with this project. By 2/17, post the name, background info and mission statement, core values, etc. of your organization. By 3/24, post a draft of your balanced scorecard for student feedback. By 3/31, post three reviews for fellow students (be specific, honest and constructive). By 4/07, email the final balanced scorecard to your professor. More information regarding this project will be distributed throughout the semester. Participation (5%+extra credit)— Class and Bb participation is very important. Students should be well prepared for class and Bb discussions, as these discussions are key to internalizing the course’s most important concepts and tools. On-campus students should bring the appropriate text, their assignment and a calculator or laptop to each class session. Factors that affect the quality of student participation are: consistently contributing great comments, personal initiative (keeping up, clearing up issues before the last moment, making a positive contribution in discussions or behind the scenes), helping fellow students who post 6
  7. 7. questions in Bb, a positive attitude, preparation, punctuality, managing expectations, and thinking ahead to mitigate the consequences of unavoidable personal problems. With respect to class and Bb comments, keep in mind that quality comments are concise, insightful and compelling. They are the result of exceptional preparation and provide fruitful direction to the discussion. Students should avoid opportunistic efforts at making isolated, obvious or confusing points, and there is no need to contribute at every opportunity. Importantly, the purpose of class and Bb discussion is to create a learning community with the goal of helping every student master the course material. As such, it is a collaborative effort between students and professor. While the assignment turned in each Monday must reflect individual work (augmented by tips from the professor and study group discussions), students are free to help each other as much as needed to correct assignments for resubmission. Extra Credit Problems— Weekly assignments will be updated throughout the semester. Assignment modifications and answer sheets will be posted by Monday the week before an assignment is due (at the same time the previous week’s solution excerpts are posted). Extra credit problems will be noted at this time. Students interested in completing extra credit problems should post their solution in Bb by noon Monday. Class Sessions— If you can attend an on-campus class, do it. Class sessions will facilitate course learning by reviewing key concepts and tools, working through problems, looking ahead to next week’s chapters and assignments, and providing context to internalize key topics through discussions, lectures and in-class exercises. On-campus students can receive participation credit for contributing to class discussion and for posting summaries that would benefit off campus 631 students. Tip— The key to doing well in this course is keeping up. Unresolved confusion, poor planning and procrastination are deadly. Plan ahead by anticipating heavy assignment weeks, exam weeks, and the project deadline. Do it now. Don’t get caught flat-footed. For the student who has kept up with the reading, quizzes and problems, the discussions and exams should be relatively straightforward and interesting. Summary of Assignments, Deadlines, and Grading: Deadlines Percentage Description of Grade by each Fri, 11:00 pm, starts 1/3 5% on-line quizzes, starts 1/3 by each Mon, noon, starts 1/6 30% assignments by each Wed, 11:00 pm, starts 1/8 10% corrected assignments 2/10, Monday, noon 15% module one exam 3/10, Monday, noon 15% module two exam 20% balanced scorecard by 2/17, Monday, noon -mission/values/objectives 7
  8. 8. by 3/24, Monday, noon -draft of bsc by 3/31, Monday, noon -review bsc for three students by 4/07, Monday, noon -final bsc In addition, extra credit will be awarded for consistently completing extra credit problems, and meaningfully participating in-class and/or in Bb (e.g., posting class notes, answering posted questions, suggesting course improvements). Consistently earning extra credit can significantly bump up a student’s grade, and will likely be necessary to receive a grade above B- (i.e., 80% of points, see the School of Business’ grading scale under “Academic Policies” at end of syllabus). Course Schedule (dates correspond to VA Beach meeting schedule): SUBJECT TO CHANGE, CHECK Bb FOR UPDATES FO = Fraser & Ormiston text ABKY = Atkinson, Banker, Kaplan & Young text Y = Young readings supplement MODULE 1 FINANCIAL STATEMENT INTERPRETATION AND ANALYSIS 01/07 Readings -Carefully read through BUSN 631 syllabus -FO CH 1, Financial Statements: An Overview Graded Assignments -FO CH 1: 7, 11, 12 01/14 Readings -FO CH 2, The Balance Sheet Graded Assignments -FO CH 2: 12, 15, Rival Co. mini-case 01/21 Readings -FO CH 3, Income Statement and Statement of Stockholders' Equity -FO Appendix A, A Guide to Earnings Quality -FO Appendix B, The Analysis of Segmental Data Graded Assignments -FO CH 3: 6, 10, 13 8
  9. 9. 01/28 Readings -FO CH 4, Statement of Cash Flows Graded Assignments - FO CH 4: 4, 10, Royal Appliance mini-case 02/04 Readings -FO CH 5, The Analysis of Financial Statements Graded Assignments -FO CH 5: 1, 7, 11 MODULE 2 STRATEGIC COST MANAGEMENT 02/11 Readings -ABKY CH 1, Management Accounting: Information that Creates Value -Y CH 1.1, Be Data Literate—Know What to Know, P. Drucker -Y CH 1.3, In the Era of Electronic Commerce, A. Kogan, E F. Sudit, and M. A. Vasarhelyi -ABKY CH 2, A Framework for Management Accounting and Control Systems -Y CH 2.1, Strategic Cost Management and the Value Chain, J. Shank and V. Govindarajan Graded Assignments -ABKY CH 1: 21, 27, 31 -ABKY CH 2: 55, 59 -Y CH 1.3 -Y CH 2.1 02/18 Readings -ABKY CH 3, Cost Management Concepts and Cost Behavior -Y CH 3.1, How Cost Accounting Distorts Product Costs, R. Cooper and R. S. Kaplan -Y CH 3.2, What Are the Costs of Variability? H. P. Roth and T. L. Albright -Y CH 3.3, The Outsourcing Decision, R. E. Drtina -ABKY CH 4, Traditional Cost Management Systems (skim) -Y CH 4.1, Cost Management Concepts and Principles, R. Cooper 9
  10. 10. Graded Assignments -ABKY CH 3: 28, 30, 32, 35, 39 -Y CH 3.1 -Y CH 4.1 02/25 Readings -ABKY CH 4, Traditional Cost Management Systems -ABKY CH 5, Activity-Based Cost Management Systems -Y CH 5.2, Profitability Analysis: Challenges and New Directions, G. Foster, M. Gupta, L. Sjoblom -Y CH 5.4, Unbundling the Cost of Hospitalization, L. B. Carr Graded Assignments -ABKY CH 4: 25, 27, 33, 38, 39 -ABKY CH 5: 29, 32, 35, 41, 45 -Nally & Gibson Georgetown video case (post/discuss answers in Bb): Q1— Which costing system would you suggest Nally & Gibson use to determine product costs? Q2— Since the mining of limestone rock has an effect on the surrounding environment, what costs would you expect Nally & Gibson to incur related to maintaining and preserving the environment? Q3— What quality issues might be associated with the mining and production of different rock sizes? How do these issues affect costs and prices? Q4— If Nally & Gibson called the processing plant a joint cost area, how would it use an estimated net realizable value joint costing method? Q5— How might Nally & Gibson use a revenue mix variance analysis to examine profitability changes over time? 03/04 Readings -ABKY CH 6, Using Management Accounting Information for Activity and Process Decisions -Y CH 6.2, Designing an Information System Using Activity-Based Costing and the Theory of Constraints, R. Campbell, P. Brewer, and T. Mills -Y CH 6.3, Effective Long-Term Cost Reduction: A Strategic Perspective, M. D. Shields and S. Mark Young -View Nantucket Nectars video case -ABKY CH 7, Using Management Accounting Information for Pricing and Product Planning -Y CH 7.3, Target Costing for Cost-Plus Pricing Companies, M. E. Bayou and A. Reinstein Graded Assignments 10
  11. 11. -ABKY CH 6: 32, 38, 43, 45, 51 [extra credit: 52, 58] -ABKY CH 7: 37, 38, 45, 49 -Y CH 6.3 -Y CH 7.3 -Teva Sport Sandals video case (post/discuss answers in Bb): Q1— How are inventory issues different for web-based businesses versus traditional “bricks and mortar” retailers? Q2— From an inventory perspective, does the conduct of business over the web have any advantages over a traditional retailing environment? -Ritz Carlton Hotel Company video case (post/discuss answers in Bb): Q1— In what ways could the Ritz-Carlton monitor its success at achieving quality? Q2— Many companies say that their goal is to provide quality products and/or services. What actions might you expect a company to take if it intends quality to be more than a slogan or buzzword? Q3— How does lack of quality, or missing a quality goal, influence the Ritz-Carlton’s contribution margin? Q4— Why might it cost the Ritz-Carlton less to “do things right” the first time? Q5— How could control charts, pareto diagrams, and cause-and-effect diagrams be used to identify quality problems? Q6— What are some non-financial measures of customer satisfaction that might be used by the Ritz-Carlton? -Grand Canyon Railway video case (post/discuss answers in Bb): Q1— What environmental and market factors might affect the Grand Canyon Railway’s pricing decisions? Q2— What are the implications of the Grand Canyon Railway’s cost structure? Q3— Since capacity on the railway is fixed each trip, what might managers do to try to fill empty seats in the Club and Chief cars on the day of departure? Q4— How does the offering of fewer pricing packages impact Grand Canyon Railway’s costs? Q5— Why might it make sense for Grand Canyon Railway to attempt to increase revenues through booking tour packages, such as transportation, hotels and meals? 03/11 Readings -ABKY CH 8, Using Management Accounting Information for Investment Decisions -Y CH 8.1, How ABC was Used in Capital Budgeting, S. Coburn, H. Grove and T. Cook -Y CH 8.3, Activity Based Management to Justify ERP Implementations, S. Gamster Graded Assignments -ABKY CH 8: 54, 55, 65 11
  12. 12. -Y CH 8.3 -Deer Valley Resort video case (post/discuss answers in Bb): Q1— What other types of capital budgeting projects would you expect Deer Valley to have in its rolling 10-year plan? If you were making the decision to allocate funds for projects, what factors would you consider in your analysis? Q2— What influence might competition, and the 2002 Winter Olympics (held in Park City), have on Deer Valley’s capital budgeting and planning? Q3— What risks do you expect Deer Valley faced with the base lodge renovation project? Q4— Deer Valley Resort is a partnership. How does this form of ownership make a difference in whether to consider the tax implications of a capital budgeting project? MODULE 3 PERFORMANCE MEASUREMENT AND CONTROL 03/18 Readings -ABKY CH 9, Management Accounting and Control Systems for Strategic Purposes: Assessing Performance over the Entire Value Chain -Y CH 9.1, Control Tomorrow's Costs Through Today's Design, R. Cooper and W. Bruce Chew -Y CH 9.2, Elements of Supply Chain Management, T. Albright and S. Davis -Y CH 9.4, Implementing Management Innovations Successfully: Principles for Lasting Change, S. Mark Young -ABKY CH 10, Motivating Behavior in Management Accounting and Control Systems -Y CH 10.1, Using the Balanced Scorecard as a Strategic Management System, R. S. Kaplan and D. P. Norton -Y CH 10.2, Control Function of Management, K. A. Merchant -Y CH 10.3, Why Incentive Plans Cannot Work, A. Kohn Graded Assignments -ABKY CH 9: 52, 53, 61 -ABKY CH 10: 67, 72, 73, 76, 77, 80 -Y CH 9.1 -Y CH 9.4 -Y CH 10.2 -Y CH 10.3 -McDonald’s Corporation video case (post/discuss answers in Bb): Q1— Analyze McDonald’s use of the five forces industry analysis tool. Which force appears strongest? Which appears weakest? How could McDonald’s management use this analysis? Q2— What strategy is McDonald’s pursuing, cost leadership or product differentiation? Q3— The balanced scorecard at McDonald’s has two major categories, sales drivers and profit after controllables. Does this seem to indicate that the company is focused solely on 12
  13. 13. financial performance? If you were a store manager, what measures might you want to see on your scorecard? -McDonald’s Corporation video case (post/discuss answers in Bb): Q1— Of the 25,000-plus stores that McDonald’s operates around the globe, 1,800-plus of them are company-owned. Does it make sense to devise a single compensation plan for use in all locations? Why or why not? Q2— Return on investment (ROI) has been used in the past as part of a store manager’s performance evaluation. For company-owned stores, is this a viable measure of performance for store managers? Why or why not? Q3— Put yourself in the position of a store manager at McDonald’s. Since the stores operate with the same vision, should McDonald’s use benchmarking and relative performance evaluation to compensate store managers? What are the pros and cons? 03/25 Readings -ABKY CH 11, Using Budgets to Achieve Organizational Objectives -Y CH 11.1, Continuous Budgeting at the Hon Company, R. Drtina, S. Hoeger, and J. Schaub -Y CH 11.2, Budgeting Gamesmanship, C. K. Bart Graded Assignments -ABKY CH 11: 40, 51, 52, 63, 66, 70 -Y CH 11.1 -Y CH 11.2 -Ritz-Carlton Hotel Company video case (post/discuss answers in Bb): Q1— How would you expect the Ritz-Carlton to develop its standard costs per occupied room? How would these elements differ between locations? Q2— The Ritz-Carlton recently started giving all employees the chance to meet with the controller to review budgets and reports on actual performance as a form of participatory budgeting. What advantages and disadvantages do you see with this approach? Q3— How might the Ritz-Carlton use benchmarking within its hotel chain to improve efficiency? Q4— What factors might affect the Ritz-Carlton’s annual sales forecast for room occupancy? For restaurants? For use of meeting rooms and conference facilities? Q5— How is uncertainty handled in the budget process? Q6— The Ritz-Carlton uses responsibility accounting for its worldwide hotel and resort operations. What levels of responsibility reports would you expect to see throughout the company? -Oracle Corporation video case (post/discuss answers in Bb): Q1— Alex Seven makes a comment about how the accounts receivable function has the opportunity to “improve the business processes” at Oracle. What did he mean? 04/01 13
  14. 14. Readings -ABKY CH 12, Organizational Design, Responsibility Centers, and Financial Control -Y CH 12.1, Transfer Pricing with ABC, R. S. Kaplan, D. Weiss, and E. Desheh -Y CH 12.2, Is EVA, and How Can It Help Your Company?, P. A. Dierks and A. Patel -Y CH 12.3, “Greening” with EVA, M. J. Epstein and S. David Young Graded Assignments -ABKY CH 12: 54, 64, 66, 71, 73, 75, 86 -Y CH 12.1 -Y CH 12.2 -Y CH 12.3 -McDonald’s Corporation video case (post/discuss answers in Bb): Q1— The Quality Cost Report used by store managers to monitor food costs contains the basic elements of a particular type of cost accounting report. Which report does it resemble? Q2— Every McDonald’s store manager carefully monitors labor costs. Which type of cost accounting report was described in the video? For what decision might a store manager use this report? Q3— Non-financial measures are important to the operations of each McDonald’s store. Cleanliness of public areas is one such measure. What other non-financial measures do you think the company uses? Why do non-financial measures matter in cost accounting? Academic Policies: Incomplete Grades— An incomplete grade ("I") may be given due to illness or other emergencies. Current regulations governing the administration of incomplete grades appear in the catalog. Academic Honesty—Regent University's community of teachers and scholars recognizes that strict adherence to the principles of truth and honesty is absolutely essential. These principles shall be rigorously followed in all academic endeavors, including the preparation and presentation of lectures, preparation of class reports and papers, giving and taking of examinations, and in protecting the validity of assigned grades. All work shall be done without unauthorized aids by the person who purports to do the work. Instructors will exercise due diligence in planning and supervising the academic program so that the principles of truth and honesty are encouraged. Students at Regent University shall abide by the highest standards of academic honesty. Cheating and plagiarism are sins contrary to the laws of God and to the mission of the University. Click here to access the Student Handbook for further information on the Student Honor Code. Course Grades—The Regent University Graduate School of Business grading scales is provided below: Letter Percentage GPA Points 14
  15. 15. A+ 97-100 4.00 A 94-96.9 4.00 A- 90-93.9 3.67 B+ 87-89.9 3.33 B 83-86.9 3.00 B- 80-82.9 2.67 C+ 77-79.9 2.33 C 73-76.9 2.00 C- 70-72.9 1.67 D+ 67-69.9 1.33 D 63-66.9 1.00 D- 60-62.9 0.67 F 0-59.9 0.00 15