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Management Information

The document outlines a certificate-level exam focusing on management information, covering topics such as cost calculations, budgeting, and costing methods. It defines key concepts like cost, expense, cost ascertainment, cost estimation, and cost objects, emphasizing their importance in management decision-making. Additionally, it includes various question formats including scenario-based and multiple-choice questions related to these concepts.

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24 views3 pages

Management Information

The document outlines a certificate-level exam focusing on management information, covering topics such as cost calculations, budgeting, and costing methods. It defines key concepts like cost, expense, cost ascertainment, cost estimation, and cost objects, emphasizing their importance in management decision-making. Additionally, it includes various question formats including scenario-based and multiple-choice questions related to these concepts.

Uploaded by

ssac.salman
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Focus on the certificate-level exam for management information.

Scenario-based Question: 2 Requirement 5+5 =10*2 Marks


i) Total cost
ii) Production cost
iii) Prime cost
iv) Period cost (admin+marketing)

v) Marginal costing vs absorption costing


vi) Budgeted income statement (Working capital)

vii) LIFO and FIFO


viii) Limiting factor analysis
ix) Overhead
MCQ-Base Question:
Math portion: 28 (20) Theory (15)

Costing (1-3) 3

Marginal vs absorption 2 2

Pricing Calculation 2 2
(Markup-margin)
(Transfer pricing)

Budgeting
Working capital 10 2

Performance management 3
Standard variance 3 3

Break even and limiting 2 3


Investment 3

The fundamentals of costing


What is cost?
Cost is a resource (money or monetary term) sacrificed or forgone to achieve a specific objective or
activity (product, job, service, process or any other activity)
What is expense?
Expenses measured the outflow of goods or services, which is matched with revenue to determine income
Or,
Expenses are expired cost, incurred and totally used up in generation of revenue.

What is Cost Ascertainment?


Computation of actual costs incurred in terms the methods and process employed in ascertaining costs.
Different type of industry employed different methods employed for ascertaining cost.

What is Cost estimation?


Is a process of predetermining costs of goods or services. These costs are prepared in advanced of
production and precede the operations. Estimated cost are definitely future cost.

What is cost object?


A cost object is anything for which we are trying to ascertain the cost.
First, Determining the cost of any product or activity is to define precisely the cost object or cost
objective. A cost object can be any function, process, organization unit or physical item of interest to
management for which separate measurement of cost is desired.
The cost object is not itself, rather the cost object is the produced or activity whose cost is to be measured.
Specifically, the cost object is defined accurately the resulting cost data that are reported and used to make
many different decision.
If we asked to determine the cost to produce a unit of product, the unit of product is the cost object.
If we asked about cost maintenance in an in-house accounting department, the department is a cost object.
Cost classification

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