Chapter 1-5 of the study guide cover the following topics: [1] Comparison of financial and managerial accounting, cost accounting systems, activity-based costing, just-in-time, and cost-volume-profit analysis. [2] Calculating job costs, process costs, predetermined overhead rates, and variances. [3] Understanding the differences between traditional and activity-based costing systems and when to implement ABC. [4] Analyzing cost behavior, calculating break-even points, margin of safety, and target profits. The terminal objectives cover preparing various accounting entries and reports, calculating budgets, variances, and project cash flows.

1. Study Guide for Chapters 1 thru 5
Chapter 1
Comparison of Financial and Managerial Accounting
Definitions
Manufacturing cost, direct material, manufacturing overhead, period cost,
just-in-time, total quality management, activity-based-costing, value chain,
enterprise resource planning, cost of goods purchased, cost of goods
manufactured.
Determine the cot of goods manufactured.
Chapter 2
Job Accounting Systems
Definitions
Job order cost system, process cost system
Calculating predetermined overhead rate
Basic operation job costing system
Variances in overhead
Chapter 3
Process Cost Accounting
Similarities and differences between job and process cost system
Equivalent Units
Weight-Average Methods
Computer unit production costs
Chapter 4
Activity–Based-Costing
Comparison ABC to Traditional
Definition; Activities, Cost Drivers,
Being able to show the difference between traditional and ABC
Benefits of ABC

2. Limitations of ABC
When to switch to ABC?
Just-In-Time
Elements
Benefits
Chapter 5
Cost-Volume-Profit Relationships
Cost behavior analysis
Variable Cost
Fixed Costs
Relevant Range
Mixed Costs
High-low Method
Importance of identifying variable and fixed costs
Cost-volume-profit analysis
Contribution margin per unit
Contribution margin ratio
Break-even analysis
Margin of safety
Target net income

3. Terminal Course Objectives:
1. Given relevant information in a job costing environment, prepare the entries
following the cost flow from material purchases to cost of goods sold including the
close out of over or under applied overhead and explain the importance of the
application rate assumption.
2. Given the relevant data, calculate the value of goods transferred out and the WIP
inventory in a process environment.
3. Given historical data regarding costs at different volume levels and given additional
information regarding step costs influencing the relevant range, analyze the cost
structure of the company and calculate total and per unit costs at given volume
levels.
4. Given the cost structure of an organization and the selling price, calculate breakeven
units and dollars and the volume necessary to determine a pre and after tax profit
goal. Using the data, analyze the changing risk and reward of changes in the cost
structure, sales price, and volume.
5. Analyze the purposes of the creation of the master budget in terms of reports
typically generated, the planning and feedback process, the concept of goal
congruence, and issues regarding resources available such as equipment, hourly
labor or professional staff, and cash.
6. Given relevant data regarding the master plan, calculate a master plan with particular
attention to the application base of fixed overhead and given different actual volume
achieved, calculate a flexible budget, calculate volume and operational variances,
and using a standard cost methodology, calculate four-way variances from the plan,
and assess reasons for variances and define analytical steps to investigate the
reasons.
7. Given relevant data as to GAAP costs and direct (variable) cost, prepare Income
Statements on both bases and account for the difference caused by changes in
inventory and evaluate which method to use for make or buy decisions, quality of
earnings issue, and others.
8. Given relevant data as to cash flows and investments and given a discount rate,
calculate the NPV and IRR, and choose between competing projects.