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ACCOUNTING & ENGINEERING
ECONOMY
MUHAMMAD IRFAN
Assistant Professor, Sarhad University, Peshawar.
ACCOUNTING & ENGINEERING ECONOMY
Engineering economy.
 The systematic evaluation of the costs and benefits of proposed
technical and business projects and ventures.
 Focuses on the financial aspects of projects.
 Evaluating and predicting future events.
Accounting .
 The process of identifying, measuring and communicating economic
information to permit informed judgment and decision by user of the
information.
 Focuses on the financial aspects of firms.
 Evaluating past performance.
ACCOUNTING & ENGINEERING ECONOMY
 The practice of engineering economy will be easier with a
basic understanding of some accounting principles.
 Based on the results of accounting outcomes management
allocates
 Resources to projects.
 Evaluates unit and firm performance.
 Selects and directs personnel.
FUNCTION OF ENGINEERING ECONOMY
 Develop the alternatives.
 The decision ( choice ) is among alternatives. The
feasible alternatives need to be identified and then
defined for subsequent analysis
 Focus on the differences of the alternatives.
 Only the differences in the expected future outcomes
among the alternatives are relevant to their comparison
and should be considered in the decision.
 Use a consistent view point for all the alternatives.
 The prospective outcomes of the feasible alternatives,
economic and other, should be developed from a
consistent and defined view point
FUNCTION OF ENGINEERING ECONOMY
 Use a common unit of measurement for comparison
among alternatives .
 Using a common unit of measurement to enumerate as many
of the prospective outcomes as possible will make easier the
analysis and comparison of the feasible alternatives
 Consider all relevant criteria.
 Considering all relevant criteria, selection of preferred
alternatives is done
 Make uncertainty explicit.
 Uncertainty is inherent
 Review your decisions
 Improved decision making results from an adoptive process
FUNCTION OF ACCOUNTING
 Recording of all financial transactions.
 Journal
 Classifying.
 Ledger
 Summarizing.
 Trial Balance,
 Income Statement (Profit & Loss Account),
 Balance Sheet (Assets & Liabilities)
FUNCTION OF ACCOUNTING
 Analysis and Interpreting.
 Ratio Analysis
 Communicating .
 Ratios, Graphs, Diagrams etc.
FUNCTION OF ACCOUNTING
Thank You…

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(Week 13)

  • 1.
  • 2. ACCOUNTING & ENGINEERING ECONOMY MUHAMMAD IRFAN Assistant Professor, Sarhad University, Peshawar.
  • 3. ACCOUNTING & ENGINEERING ECONOMY Engineering economy.  The systematic evaluation of the costs and benefits of proposed technical and business projects and ventures.  Focuses on the financial aspects of projects.  Evaluating and predicting future events. Accounting .  The process of identifying, measuring and communicating economic information to permit informed judgment and decision by user of the information.  Focuses on the financial aspects of firms.  Evaluating past performance.
  • 4. ACCOUNTING & ENGINEERING ECONOMY  The practice of engineering economy will be easier with a basic understanding of some accounting principles.  Based on the results of accounting outcomes management allocates  Resources to projects.  Evaluates unit and firm performance.  Selects and directs personnel.
  • 5. FUNCTION OF ENGINEERING ECONOMY  Develop the alternatives.  The decision ( choice ) is among alternatives. The feasible alternatives need to be identified and then defined for subsequent analysis  Focus on the differences of the alternatives.  Only the differences in the expected future outcomes among the alternatives are relevant to their comparison and should be considered in the decision.  Use a consistent view point for all the alternatives.  The prospective outcomes of the feasible alternatives, economic and other, should be developed from a consistent and defined view point
  • 6. FUNCTION OF ENGINEERING ECONOMY  Use a common unit of measurement for comparison among alternatives .  Using a common unit of measurement to enumerate as many of the prospective outcomes as possible will make easier the analysis and comparison of the feasible alternatives  Consider all relevant criteria.  Considering all relevant criteria, selection of preferred alternatives is done  Make uncertainty explicit.  Uncertainty is inherent  Review your decisions  Improved decision making results from an adoptive process
  • 7. FUNCTION OF ACCOUNTING  Recording of all financial transactions.  Journal  Classifying.  Ledger  Summarizing.  Trial Balance,  Income Statement (Profit & Loss Account),  Balance Sheet (Assets & Liabilities)
  • 8. FUNCTION OF ACCOUNTING  Analysis and Interpreting.  Ratio Analysis  Communicating .  Ratios, Graphs, Diagrams etc.