Tribhuvan University

Faculty of Management

Office of the Dean

Bachelor of Hotel Management (BHM)

Course Title: Cost and Management Accountancy

Course Code: ACC 201

Semester: Semester 3

Nature of Course: required

Full Marks: 100

Pass Marks: 50

Credit Hours: 3 Cr.

Curriculum: Recent BHM syllabus series

Course Description

This course aims to provide comprehensive knowledge on cost ascertainment, classification, controlling and estimation of cost required for managerial planning and decision making. It covers cost manag ement, income under variable and absorption costing, cost volume profit analysis, price determination, capital expenditure planning, budgeting and Decision ma king under different situations.

Course Objective

The objectives of the course are to provide the students with in -depth knowledge of cost and management accounting tools and techniques in order to enable them to accumulate, classify and analyze cost information required for decision making for maximizing the profit of Hospitality Industry. Course Description This course aims to provide comprehensive knowledge on cost ascertainment, classification, controlling and estimation of cost required for managerial planning and decision making. It covers cost manag ement, income under variable and absorption costing, cost volume profit analysis, price determination, capital expenditure planning, budgeting and Decision ma king under different situations.

Course Contents:

Lecture hours show the approximate classroom time allocated to each unit.

Concept, meaning and b ranches of accounting, Limitations of fi nancial accounting, Meaning of Cost accounting and manage ment accounting, Objectives of Cost and management a ccounting, Role of Management Accounting in Decision Making, Relationship between C ost and management accounting, Limitations of Cost and management accounting.

Meaning and Classification of cost , Meaning and method of costing, Meaning of Menu costing, Meaning of Accommodation costing, Separating costs into fixed and variable elements using High Low Method and Least square method, Estimation of cost.

Introduction, significance and limitations of C ost volume profit analysis, Assumption of C ost volume profit analysis, Approaches to Break even analysis: Formula approach, Graphical approach, Contribution margin analysis.

Meaning of Absorption costin g and Variable costing, Differences between Absorption costing and Variable costing, Income Measurement under Variable Costing and Absorption Costing

Meaning and importance of pricing , Approaches to pricing: Cost plus pricing method, Gross profit or gross margin method, pricing hotel accommodation, pricing food and beverage.

Concept of budget, budgeting and budgetary control, Purpose and functions of budgeting, Preparation of various budgets: Sales revenue budget, Produ ction budget, Operating expenses budget, Cash budget, limitation of fixed budget, concept of flexible budget and flexible budget for overhead cost control on various levels of activity.

Concept of Capital investment Decision, Cash flow and pro fit and loss account, Steps of C apital investment Decision: a. Cash flow Estimation, Net cash outlay (NCO), Cash flows after tax (CFAT), Net cash flow for final year b. Evaluation techniques of capital investment project.

Concept of Decision Making, Costs related w ith Decision Making : Opportunity cost, Differential cost, Imputed cost, Out of pocket cost, Sunk cost, Relevant cost and Irrelevant cost, Decision involving alternate choice: Make or buy decision, Drop or continue decision, Accept or reject order decision, Decision for continue or closure in off season.

Cost and Management Accountancy

Syllabus