MMO5005 Cost Accounting

Contents and structure

The course covers the most important aspects of financial Business Administration and cost accounting for technical oriented participants in the maritime industry. The course provides an introduction to the foundations of investments and finance, several aspects of management accounting & control as well as the practical application of the acquired theoretical knowledge trough participating in a computer based management simulation. The Course is divided into 3 main parts.

Part 1 focusses on the prerequisites and foundations for investments and finance including the following areas (but not restricted to): calculating cash flows relevant for decision making, interest calculations and financial mathematics, net present value calculations, investment analysis and methods & sources of financing.

Part 2 covers the area of management accounting especially introducing key ideas, concepts, and tools of strategic management accounting and control. Including the following content (but not restricted to): Income and cost control, models for internal accounts including the use of normal and standard costing, cost distribution, decision-relevant costs and income, budgeting, performance measurement, and balanced scorecard.

Part 3 is integrating the theoretical knowledge of the above parts through a practical application. For a better understanding of the complex interactions within a maritime company the students participate in a computer based management simulation. They take the role of the board of executives of a maritime company and experience typical conflicts in corporate governance. The Participants learn to apply business economic methods and information resources as well as how to deal with the uncertainty of decision-making usually in a team, often under time pressure.

Learning Outcome

The student has broad knowledge in various aspects of financial Business Administration and cost accounting. After having taken this course the students are expected to have the following knowledge, skills and general competence:

Knowledge:

The student:

• Can explain various principles for cost estimation, cost distribution, and product calculations.
• Is familiar with budgeting as a management tool, and can explain how budgeting processes are organized and carried out.
• Can explain how enterprises are financed, new investments are considered, and how annual accounts are prepared and analyzed.
• Can explain the basis for the time value of money and the relationship between the use of net current value as a decision making criterion for investments.
• Can account for the relationship between net current value and the internal rate of return.
• Knows the purpose of a financial statement.
• Knows the concepts of expenses, costs, expenditures, revenues and payments and has acquired a good understanding of the cost concept and cost variation.
• Knows about various principles for cost distribution, and product calculation.
• Is familiar with budget as a management tool, and can account for how budget processes are organized and carried out.

 

 Skills:

The student:

• Can budget cash flows that are relevant for decision-making concerning investment and financial decisions.
• Can carry out profitability analyses based on net current value.
• Can calculate an internal rate of return.
• Is able to carry out cost, profit and volume analyzes.

Can apply the most common instruments of strategic management accounting to evaluate an organization's performance and to support strategic decision-making.

Can calculate financial performance measures.

Is able to develop pre and post calculations using the self-cost and contribution principles for firms in various business sectors.

Can perform traditional calculations based on the normal and standard costing methods.

Can design and use a balanced scorecard for evaluating performance.

• Can set up budgets (result, liquidity, and balance budgets) based on the company's plans and activities for a given period, and see the connection between the company's various subordinate budgets.

Can apply knowledge from the various academic fields to practical problems in the workplace, and can collect and analyze relevant information in order to solve a wide specter of problems within business administration and management.

Is able to update his/her own knowledge throughout his/her working life.

 

General Qualifications:

The student:

• Has basic academic insight, analytical training, and an understanding of problems within the general fields of financial business administration and cost accounting.
• Can plan and carry out his/her own analyses of practical problems and make decisions based on these analyses.
• Can convey academic material both orally and in writing, and can exchange views and experience, thereby contributing towards the development of good work experiences.
• Can ask critical questions about and reflect upon central prerequisites and assumptions within this academic field.

Entry requirements

None.

Recommended previous knowledge

None.

Teaching methods

Lectures, exercises, interactive discussions and Group work consisting of case studies, computer based management simulation and student presentations.

Compulsory learning activities

Yes, (will be specified in the course plan by semester start).

Assessment

Portfolio, 100%.

Examination support material

Will be clarified during the lectures.

More about examination support material