Management Accounting

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Term 2
SCQF Level
Business, Law and Social Sciences


This module extends the basics of management accounting in its role in shaping long term decisions, in planning and in control and presenting reports to management.


The aim of this module is to develop the students' ability to examine management accounting problems surrounding long term planning, control and decision making within the business unit.

Learning Outcomes

By the end of this module the student should be able to:

  1. apply quantitative expertise in the use of appropriate management accounting techniques and account for the strengths and weaknesses of these methods.
  2. explain the use of relevant management accounting theories and techniques in supporting business decisions.
  3. work effectively as a member of a group, in providing a cohesive group presentation in response to a given assignment.

Indicative Content

1 Further issues in Costing

Overhead allocation, apportionment, absorption and preparation of overhead cost statements; compilation of process costing statements and joint costing statements using FIFO and Weighted Average considering opening and closing inventory valuation; throughput costing; techniques in short-term decision making- further issues

2 Marginal Costing and Absorption Costing

Cost-volume profit analysis for multi-product. Reconciliation of Absorption and Marginal costing profits: calculation of marginal and absorption cost of products and services.

3 Capital Investment Appraisal

Investment appraisal methods; Net Present Value, Payback, Internal Rate of Return and Accounting Rate of Return. Strengths and weaknesses of these methods. Sensitivity analysis applied to capital investment appraisal.

4 Working Capital

The nature and importance of working capital. Management of working capital. Determining working capital needs.

5 Variance Analysis

Various roles of budgets and their behavioural implications. Functional and flexed budgets. Calculation and interpretation of variances. Reconciliation of actual to planned performance by means of variances. Distinguish between planning and operational variances. Role of MRP and ERP systems in supporting standard costing systems. Material mix and yield variances, sales mix and quantity variances.

Teaching and Learning MethodHours
Supervised Practical Activity2
Unsupervised Practical Activity0

Guidance Notes

SCQF Level - The Scottish Credit and Qualifications Framework provides an indication of the complexity of award qualifications and associated learning and operates on an ascending numeric scale from Levels 1-12 with SCQF Level 10 equating to a Scottish undergraduate Honours degree.

Credit Value – The total value of SCQF credits for the module. 20 credits are the equivalent of 10 ECTS credits. A full-time student should normally register for 60 SCQF credits per semester.


We make every effort to ensure that the information on our website is accurate but it is possible that some changes may occur prior to the academic year of entry. The modules listed in this catalogue are offered subject to availability during academic year 2023/4, and may be subject to change for future years.