AVSC 3200 COURSE PREVIEW
Aviation Managerial Accounting
Provides aviation administration students with knowledge of financial, managerial, and basic cost accounting concepts and applications. Introduces basic accounting methods, accounting information systems and the utilization of accounting information in the decision making process. Uses aviation industry case studies and examples.
Evaluate the utility of managerial accounting.
- Differentiate between financial and managerial accounting.
- Explain why managerial accounting is important to managers for planning, controlling and decision-making activities.
- Identify common uses of data obtained through managerial accounting.
- Describe managerial accounting’s relevance to various professions within and without the aviation industry.
Recognize managerial terms and concepts in an aviation business organization.
- Distinguish between product costs and period costs.
- Identify an organization’s cost drivers.
- Describe the behavior of fixed and variable costs in total, and on a per-unit basis.
- Distinguish between direct and indirect costs, and controllable and uncontrollable costs.
- Prepare a schedule of cost of goods manufactured, cost of goods sold and income statement for a manufacturing company.
Distinguish between job order costing and process costing.
- List and explain the similarities and differences between job order costing and process costing.
- Describe the role of product costing in manufacturing and nonmanufacturing firms.
- Prepare journal entries to record the costs of material, labor and overhead in a job order costing system and a process costing system.
- Compute a pre-determined overhead rate and explain its use in job order costing.
Apply cost-volume-profit analysis to evaluate the viability and profitability of a business.
- Compute the break-even point for an aviation business venture.
- Demonstrate the effects on profit of changes in sales price, sales volume, fixed and variable expenses.
- Evaluate the level of sales needed to obtain a target level of profit.
- Compute the margin of safety and explain its significance.
Distinguish between variable costing and absorption costing methodologies.
- Explain the accounting treatment of fixed manufacturing overhead under absorption and variable costing.
- Prepare an income statement under absorption costing.
- Prepare an income statement under variable costing.
- Describe the implications of absorption and variable costing for cost-volume-profit analysis.
Distinguish between traditional, volume-based product costing and activity-based costing systems.
- Describe why traditional, volume-based product costing distorts product costs.
- List and explain the criteria for selecting cost drivers.
- Calculate product costs under an activity-based costing system.
- Describe how activity-based costing can be applied to service industry organizations.
Understand the purpose of budgeting and how budgets are prepared.
- Describe the objectives of budgeting in an aviation business.
- Summarize the budget preparation process.
- Prepare a sales budget, including a schedule of cash collections.
- Compile a direct materials budget that incorporates cash disbursements.
- Prepare a cash budget for an aviation business.
Create flexible budgets and performance reports.
- Distinguish between static and flexible budgets and explain the advantages of a flexible budget.
- Compose a flexible budget for an aviation business that incorporates changes in activity levels.
- Compute and interpret variable overhead spending and efficiency variances and the fixed overhead budget and volume variances.
- Calculate and interpret the sales price and sales volume variances.
- Prepare and analyze a performance report of flexible budget variances.
Evaluate how standard costing is used to manage and analyze costs.
- Explain how standard costs are used in product costing.
- Summarize the advantages and disadvantages of standard costing.
- Compute and interpret direct material price and quantity variances and direct labor rate and efficiency variances.
- Describe some behavioral effects of standard costing.
Understand the usefulness and role of responsibility accounting.
- Explain the role of responsibility accounting in achieving company objectives.
- Define and give examples of a revenue center, cost center and investment center.
- Prepare a performance report for a responsibility center and explain its usefulness.
- Compute return on investment (ROI) and analyze how changes in sales, expenses and assets impact ROI.
Explain why differential analysis is the key to decision-making.
- Describe the steps in the decision-making process and the role of the managerial accountant.
- Explain the difference between quantitative and qualitative criteria in decision-making.
- List and explain the criteria for a cost to be considered relevant.
- Identify relevant costs and benefits through the proper treatment of sunk costs and opportunity costs.
Describe the balanced scorecard concept and its importance in evaluating the performance of an aviation business organization.
- List the components of a balanced scorecard.
- Explain the reasoning behind the balanced scorecard components.
- Determine the relevant criteria for a balanced scorecard for an aviation business.
- Prepare and analyze a balanced scorecard for an aviation business.