EM 501

FINANCIAL AND MANAGEMENT ACCOUNTING

2011-2012 FALL SEMESTER
Instructors:

Assistant :
Schedule:

Section 1

Serhan Duran
sduran@ie.metu.edu.tr
Section 2
Canan Sepil
sepil@ie.metu.edu.tr
To be announced
Section 1
Section 2

Thursday
Thursday

(Room No: IE224)

(Room No: IE220)

18:00 - 20:50 @IE 03

18:00 - 20:50 @IE 102

Course Description
Basics of financial accounting. Preparation of balance sheet, income statement and flow of
funds statement. Inventory valuation and depreciation methods. Basics of accounting.
Definition of costs. Absorption cost techniques, with an emphasis on allocation of
overhead in manufacturing organizations. Budgeting. Variance Analysis. Cost-VolumeProfit Analysis. Pricing decisions, special decisions based on incremental analysis.
Texts:
1. Financial Accounting - Schaum Series by Siegel and Shim, McGraw Hill (1999).
HF5661 S47. (Available for sale at the University Bookstore) (S&S)
2. Cost Accounting A Managerial Emphasis, Horngern, Foster and Datar, Eleventh
Edition, Prentice Hall (2003). HF5686.C8 H59 2003. (Available for sale at the
University Bookstore). (HF&D)
3. Financial Accounting IFRS Edition Weygandt, Kimmel and Kieso, John Wiley &
Sons (2011)
References:
General Accounting
1. Principles of Accounting - Needles et. al., Houghton Mifflin (1996) - HF5635 N35.
2. Accounting Principles Weygandt, Kimmel, Kieso (2010)
Cost Accounting
1. Cost and Managerial Accounting - Gray and Ricketts, McGraw-Hill (1982) HF5686 C8
G685.
2. Cost Accounting: Concepts and Techniques for Management - Killough and
Leininger, West Publishing (1987), HF5686 C8 K488.
Grading (Tentative)
Case
Exam I
Homeworks (Best 5 out of 6)

10%
40%
10%

Final Exam

40%

Course Outline and Associated Reading Assignments (Tentative)

Financial Accounting
Weeks
Subject
1
Accounting and accounting equation; Corporations and Partnerships (S&S Chapters 1, 12, and 13; (HF&D) - Chapter 1).
2
Cash basis versus accrual basis of accounting; Transactions recording;
Adjusting and closing entries (S&S - Chapter 2, Chapter 3 and Chapter 4)
3-4
Preparation of balance sheet and income statement; Cost of goods sold for a
merchandising business (S&S - Chapter 2, Chapter 5 and Chapter 6).
5
Accounting for inventories; Depreciation; Statement of changes in financial
position (S&S - Chapter 8, Chapter 10 and Chapter 15).
6
Statement of Cash Flows (S&S - Chapter 15)
7
Financial statement analysis (S&S - Chapter 14).
Cost Accounting
Weeks
Subject
8
Midterm 1
9
Types of costs; Cost estimation ((HF&D) - Chapter 2 and Chapter 10).
10
Job costing ((HF&D) - Chapter 4)
11
Process costing ((HF&D) - Chapter 17)
12
Spoilage, Rework, and Scrap ((HF&D) - Chapter 18)
13
Activity Based Costing ((HF&D) - Chapter 5)
14
Master budget, flexible budgeting ((HF&D) - Chapter 6 and Chapter 7)
Variance analysis ((HF&D) - Chapter 8)
Students are responsible for checking the course web site on metu online regularly. Course
material will be uploaded for each week and the students should come to class after reading
the material on the web site and the corresponding material in the book.