Cost Accounting is appearing for the first time for BMS students and this subject is slightly different from the conventional accounts you have studied up till now.
“Practice is a must for any kind of accounts and cost accounting is not an exception”, says Dipali Ille, an accounts lover from Gokhale College. “Ensure that you have the formats in place”” suggests Siddhi Salunkhe and from Joshi Bedekar college.
Dipali also advises to refer as many books as you can and not just stick to one text book for practical subjects.
Now that we are empowered with advises from our seniors let’s have a look at the syllabus and analyze it section wise:
Unit I : Introduction & Importance of Cost Accounting:
Cost costing, cost accounting: Cost ascertainment: Cost control : Cost classification : Reporting : Distinction between cost & financial accountancy : Advantages of cost accounting : Objectives of cost accounting.
- Theory based section.
- Study this at the end for exams.
- Understand the concepts but focus more on the sums.
Unit II :
A. Elements of Cost: material – labour – overhead
B. Bases of Cost Classification:
On the basis of :-
- Behavior / Variability
- Element of cost including direct & indirect concept
C. Determination of Total Cost
- Cost structure
- Cost sheets
- Composition of selling price
ü Practice, practice and more practice is the only way to get through these chapters.
ü Do not forget your formats, since this is slightly different than the regular financial accountancy you are used to make sure that you revise well and don’t forget your formats on the exam day.
Unit III : Reconciliation between Cost and Financial Records
Meaning and Definition – Need for reconciliation – Causes of disagreement – Procedure and preparation of statement of reconciliation.
ü Theory cum practical, this section needs attention in both aspects.
Unit IV : Elementary Principles and Techniques of Marginal Costing (Excluding Problems on Managerial Decisions)
A. Elementary Principles of Marginal Costing:
Meaning – Features of marginal costing – Advantages of marginal costing – Limitations of marginal costing – Concept of profit
B. Techniques of Marginal Costing
Contribution – Profit / volume ratio – Break even point Margin of safety – Cost volume profit analysis
ü Most important section that needs a lot of practice.
ü Comprises of theory and practical sums.
ü The sums might be lengthy and theory vast so maximum efforts are required to crack this section.
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