Smeal College of Business Managerial Accounting: B A 521Pennsylvania State University Professor HuddartCourse IntroductionInstructor: Steven Huddart Staff Assistant: Lara WilksOffice: 340 Business Building Office: 354 Business BuildingPhone: 865–3271 Phone: 865–1809e-mail: [email protected] e-mail: [email protected] Hours: Tuesday 9:30 a.m. to 10:20 a.m.Wednesday 11:00 a.m. to 11:50 a.m.Thursday 9:30 a.m. to 10:20 a.m.Course ObjectivesThis course emphasizes the use of accounting information for internalpurposes as opposed to the external disclosure focus of the financial account-ing course. We shall cover the vocabulary and mechanics of cost accountingand the design of management accounting systems for planning and control-ling operations, and for motivating personnel. The course integrates account-ing with ideas from data analysis, decision analysis, finance, microeconomics,and operations management.There are four themes we shall stress throughout the course:• information is costly;• allocations arise because markets are absent;• different costs apply for different purposes; and,• what gets measured gets attention.ReadingsThe text is Accounting for Decision Making and Control, 6th edition,by Jerold L. Zimmerman, Boston, MA: McGraw-Hill Irwin, 2009. ISBN 978-0-07-0337948-7. You can probably make do with an earlier edition, but beaware the page numbers and problem references in the course outline referto the latest edition.cSteven Huddart, 1995–2009. All rights reserved. www.personal.psu.edu/sjh11B A 521 Course IntroductionThe coursepack contains questions, caselets, cases and articles. Theproblems referenced in the outline (e.g., P2–14 University Tuition Benefits)are from the text.Class OrganizationThe course outline lists readings from the text, articles, lecture notes,questions, problems, caselets and cases to be prepared for each class. Readingthe assigned text material in advance is essential for each class. The articlesare included to increase your awareness of management accounting practices.The lecture notes summarize key ideas.Your learning is enhanced by applying the underlying principles tospecific situations and contexts. I expect you to prepare in advance all ofthe questions, problems, caselets and cases.The questions and problems should be straightforward. You need notsubmit solutions to the questions and problems. They serve primarily tostimulate discussion or to illustrate the mechanics of certain accountingtechniques. Unless you tell me are having difficulty with a particular problemor question, little class time will be spent on them.The caselets and cases are tough. I do not expect you to havemastered them before coming to class. I expect you to have invested threehours tackling the issues in the case—by reading the background materials,absorbing the facts in the case, thinking about the issues, and pushing thenumbers. The difficulties you encounter with this material will be the basisfor our class discussions. Since they are tough (and often open-ended), fewof you will have completely solved them before class. Everyone should haveattempted them. I expect each of you to be willing to lead the class to thepoint where you got stuck and explain why you got stuck. The bulk of classtime will be spent on the cases.It is my philosophy that our time in class together should fall in themiddle of the process by which you master a given topic in this course. Ithink it is very important that you develop a reasoned opinion on the issuesbefore class. Independent thinking before class is a low-risk opportunityto practice your analytical skills and develop a manager’s perspective onimportant business issues. In class, approaches to the problem that differfrom your own will emerge. You may find your view of a situation changingas class progresses. I think this is the most productive learning experienceI can help create. I recommend you spend time after class reviewing andorganizing in your own mind the substance of our discussion.Page 2Course Introduction B A 521I suggest dividing your time outside class on a given topic as follows:80% before class and 20% after class. Resist the temptation to neglect thelast 20%. It is easy to overinvest before class and underinvest after classbecause you want to get a jump on the next topic.1Reviewing the materialfrom the last class is essential to mastering that topic. Also, review is oftenexcellent preparation for the next topic.It is normal to flounder a bit in preparing for class. Be strict withyourself about the amount of time you invest in a topic before class.Recognizing where you got stuck and why you got stuck is a big step intackling the cases. Give yourself credit for this. Do not spend globs of timeperfecting an analysis for next class if you have yet to internalize the lastclass.I often start class by asking many questions. Partly, I do this to gaugeyour understanding of the issues, what you found easy about the day’sassignment, and what you found hard. Based on your answers, I decide (onthe fly and somewhat imprecisely) the issues to emphasize in the discussion.Please recognize that your responses are critical to “steering” the class. Themore you contribute, the more the class is tailored to suit your interests andneeds.Workload and Performance EvaluationYou are encouraged to work on most assignments in groups. Each of youmust turn in original analyses for four case assignments (i.e., all the caseletsand/or cases assigned for that day). For these assignments, you need turnin only one solution per group. Group members will receive the same gradefor these assignments. To ensure that all group members contribute to theassignments, each group member will be asked to evaluate the effort of theothers at the end of the term. I shall take these evaluations into accountwhen I assign grades for the course.Case writeups may not exceed two single-spaced 12 point font 1 inchmargin typewritten pages. Appendices for calculations and exhibits arepermitted.You may choose which assignments you turn in subject to the followingconstraint: You must turn in an at least one assignment each week we meet.Assignments are due at the beginning of the class in which the problems and1You may tell yourself that you can catch up on the last topic when there is moretime. Probably, there won’t be more time.Page 3B A 521 Course Introductioncases are discussed. (Keep a copy of each assignment you turn in so you canrefer to it during