IES 342: Course Overview

1. IES 342: Course Overview Chapter 1 (Blocher et al.) Objectives: Get consensus on class policies Preview of course contents Case Study: The Cappuccino Express

2. Instructor’s Contact Info Instructor: Dr. Karndee Prichanont Office Hours: Wednesday 9 a.m.-12 p.m. or by appointment Email: karndee@siit.tu.ac.th karndee@gmail.com Phone: 02-986-9009 ext 2109 Office: IE Office, room 316

3. Course Material Main Textbook: Blocher, Chen, Cokins, and Lin, Cost Management: A Strategic Emphasis, McGraw-Hill/Irwin, 3/2005. Supplements: Blocher, Chen, Cokins, and Lin, Cases and Readings for Use with Cost Management: A Strategic Emphasis, McGraw-Hill/Irwin, 3/2005. Horngren, Datar, and Foster, Cost Accounting: A Managerial Emphasis, 12/2006 Warren, C. S., J. M. Reeve, and P. E. Fess, Financial Accounting, South-Western College, ed 8/2002.

4. Course Webpage www.siit.tu.ac.th/karndee/course/ies342.html Class web page contains: • Class announcement • Class presentations • Additional handout and case studies • Additional reading materials and links to related articles • FAQ to assignments and class material • Previous exams and exam practice problem • Individual grades and scores • Inform me ASAP if you have questions with current grade / grading system If you wish not to have your grades and scores appear on the web, please let me know now.

5. Grading Policies Tentative score distribution Tentative grading criterion

6. Class Policies Classroom Behavior • Turn-off your cell phone and pager • Be on time. The door may be locked after the class starts • Minimize class interruption • No bathroom break during class session • Food and drink are ok Participation • Attendance is a minimum requirement for participation • Read and analyze the assigned case study before the class begins • Active participation in class discussion is anticipated • If participation is not active enough, I will call on your name to answer my question • Only quality and constructive comments/discussions will receive participation score

7. Class Policies Pop Quiz • Pop quiz is randomly scheduled. No advance notification. • Close book/note. Calculator may be needed. • Strictly no borrowing • Cheating will result a minus of full score of that quiz. Exam Policies • Open book/note (tentatively) • Strictly no borrowing Makeup Policy • Only for rare and extreme cases • Documented advance notification Dress Code • Only in a sensible uniform is allowed to enter the class room

8. General Course Info Part 1 Basic Financial Accounting Part 2 Cost Behavior and Cost System Part 3 Product Costing Part 4 Budgeting

9. Accounting SystemCosts and Benefits Benefits Costs Obtain system Benefits Costs > Seek alternatives Benefits < Costs

10. User Decisions Accounting: Information Process Identification of Users User Information Needs Economic Data and Activities Accounting System Reports

11. NetSolutions Trial Balance November 30, 2002 11 Cash 5,900 14 Supplies 550 17 Land 20,000 21 Accounts Payable 400 31 Chris Clark, Capital 25,000 32 Chris Clark, Drawing 2,000 41 Fees Earned 7,500 51 Wages Expense 2,125 52 Rent Expense 800 54 Utilities Expense 450 55 Supplies Expense 800 59 Miscellaneous Expense 275 32,900 32,900 Part 1: Financial Accounting Understand and develop financial statements Textbooks: • Warren, Reeve, and Fess, Financial Accounting, South-Western College, ed 8/2002. • Chapters 1, 2, 3

12. Break even sales point 8,000 units or $40,000 $ 50 Dollars (thousands) $ 40 $ 30 Total expense Sales revenue line $ 20 Fixed expense line $ 10 $ 0 0 2 4 6 8 10 12 Units (thousands) Part 2: Cost Behavior and Cost System Textbook: Blocher, Chen, Cokins, and Lin, Cost Management: A Strategic Emphasis, McGraw-Hill/Irwin, 3/2005. Chapters 3, 6, and 7

13. Part 3: Product Costing • Activity-Based Costing (ch 5) • Job Costing (ch 4) • Process Costing (ch 11) • Cost Allocation (ch 12) Cost Drivers Product A Product B Product C Textbook: Blocher, Chen, Cokins, and Lin, Cost Management: A Strategic Emphasis, McGraw-Hill/Irwin, 3/2005.

14. Part 4: Budgeting Sales Production summarizes the planned activities of all subunits of an organization. Distribution Finance Textbook: Blocher, Chen, Cokins, and Lin, Cost Management: A Strategic Emphasis, McGraw-Hill/Irwin, 3/2005. Chapters 8 & 13

15. Financialinformationabout costsand revenues. Nonfinancialinformationabout productivityand quality. The uses of cost management information Information managers need toeffectively manage an organization.

16. Define the goal Explore the environment Allocate resource Integrate sub-goals to achieve ultimate goal Strategic Managementvs Strategic Cost Management Who are we? • Strategic management requires: • Anticipating changes. • Understanding the business and competitive environment. • Ability to make changes quickly. • Ability to identify and solve problems from a cross-functional view. Strategic cost management is the development of costmanagement information to facilitate strategic management.

17. Competitive Strategy DISCUSSION: Give example of products and/or companies that are evidences of these competitive strategies. Cost Leadership Product Differentiation

18. CASE:Cappuccino Express Discussion Topics • What factor(s) can be expected to have a major impact of the success of The Cappuccino Express? • What are the major costs of operating The Cappuccino Express? • Vincent would like to monitor the performance of each site manager. What measure(s) of performance should he use?