Study Guide

Objectives (course unit)

This two-part course provides the students with cornerstone level information of both product costing and pricing as well as financial closing analysis. Relevant theoretical accounting information is used as important supporting learning material. As the most important thing, anyway, the approach and mode of operations are truly practical all through the course.

The first part of the course introduces the product costing and pricing theme to the students. Key terms and concepts are defined, and the students learn to use especially their new job costing knowledge and skills by solving basic-level costing and pricing exercises. Studying the cost - volume - profit (C-V-P) analysis and the break-even analysis themes finishes the first part of the course.

The second part of the course has its focus on ready-made financial closing information and financial key ratios based on that. In this section, the students are supervised to have their own little research on both financial statements of some publicly traded company and their own practice firm. In addition to that, several most commonly applied financial key ratios under categories profitability, liquidity and solvency are introduced to the students, and they read about, interpret and solve the values of them in practice.


After completing the course, the students will be able to:

Solve basic-level product costing and pricing problems, using especially the job-costing method.
Perform C-V-P and break-even analyses, and use the analysis results in practice.
Participate in business planning and decision making, proving various decision makers with reliable product profitability information.
Read and interpret financial closing information of the income statements, balance sheets and cash flow statements.
Calculate the values of the most common profitability measures gross profit, operating profit, net profit, return on assets and return on equity.
Evaluate the performance of companies also based on liquidity measures such as working capital, current and quick ratio as well as turnovers of A/R and inventory.
Find out the debt and/or equity ratio of a company.
Measure, evaluate and analyze the financial performance of a company, using a many-sided set of financial key ratios.
Based on the analysis work done, decide on case-specific business planning issues.

Content (course unit)

What do the different numerous costing and pricing terms and concepts mean in practice?
How is product costing and pricing implemented in practice, applying job costing?
What other alternative costing and pricing methods are there, and when are they applicable?
How are the C-V-P and break-even analyses performed, and how can the analysis results be used in businesses?
What are the most meaningful and important pieces of information on the financial statements, and how can the income statement and balance sheet information be used in external decision making?
Which measures of profitability can be identified and easily used in practice?
What are the definitions and uses of different liquidity measures?
How is solvency measured; is it simply given as a part of financial closing, or can it be planned?

Prerequisites (course unit)

-

Further information (course unit)

-

Assessment criteria, satisfactory (1-2) (course unit)

The student is able to determine and use the concepts and methods of product costing and financial closing analysis themes sufficiently. The student can take responsibility of his/her individual product costing and financial closing analysis duties in routine activities, and is able to make some contribution in a group.

Assessment criteria, good (3-4) (course unit)

The student has the competence of understanding and explaining the concepts and methods of the product costing and financial closing analysis themes, and can apply them in controllable situations. The student works actively and cooperates responsibly and constructively both individually and in a group. The student can solve product-costing problems and produce financial closing analyses, and his/her courses of action are well justified.

Assessment criteria, excellent (5) (course unit)

The student can analyse complex situations and produce alternative solution proposals to various product costing and financial closing analysis tasks and problems. The student is able to apply his/her knowledge and skills of the subject matter creatively in data collection, analyses and calculations, problem solving, and when interpreting and sharing his/her well-justified solutions. The student can work strongly individually and make remarkable contribution to group work, cooperating responsibly, constructively and flexibly with excellent commitment.

Location and time

From March 8 to April 26, 2023.

First class is at TAMK main campus in classroom H4-07 on March 8 at 11.15 a.m.

All the classes are at TAMK main campus, if not otherwise agreed during the course (max. 1-2 classes might be changed to be online ones, if necessary).

Exam schedules

No written exam.

Assessment methods and criteria

Student’s overall course grade is based on
1. the evaluation criteria of this course
2. active individual participation in the classes
3. performance of the assigned exercises
4. his/her group assignment performance, including both the group's own report and action in an opposing team.

Assessment scale

0-5

Teaching methods

Learning discussions, group assignment(s), exercises, case studies, literature, lecturing.

Learning materials

Bhimani, A., Datar, S., Horngren, C.T. & Rajan, M. 2018. Management and Cost Accounting. 7th ed. Harlow, United Kingdom: Pearson Education. Chapters 1-3, 11 and selectively also 4-5.
ISBN: 9781292232669. EISBN: 9781292232676.
https://andor.tuni.fi/permalink/358FIN_TAMPO/176jdvt/cdi_askewsholts_vlebooks_9781292232676

https://www-kauppalehti-fi.libproxy.tuni.fi/porssi/kurssit/XHEL

In addition, student groups perform their own case-specific data collection, as part of their group assignment.

Student workload

Max. some 80 hours as workload; 18 hours of that as contact teaching.

Content scheduling

Studying product costing forms the first part of the course, studying financial closing analysis the second/last part.

Completion alternatives

No.

Practical training and working life cooperation

No.

International connections

Neither guest lectures nor company visits or so in spring 2023; a truly international group of students, anyway, studying together.

Further information

Pasi Kuusijärvi, M.Sc. (Econ. & Bus. Adm.), AmO, HHJ PJ
Senior Lecturer, Accounting and Financial Management

Tampere University of Applied Sciences (TAMK)
Tampere, Finland

pasi.kuusijarvi@tuni.fi