APPLIES TO ACADEMIC YEAR 2014/2015
BØK 3421 Finance and Managerial Accounting II
Responsible for the course
Rolf Gunnar Strand, Knut Larsen
Department of Accounting - Auditing and Law
According to study plan
Language of instruction
The essence of business economics includes financial management (=income and cost analysis, managerial accounting, budgeting and control), finance (=investment and financing), financial accounting and financial statement analysis. Good knowledge within these areas is a necessary prerequisite to understand the economic content of transactions, obtain decision-relevant information, discuss and assess alternatives, make correct decisions and convey relevant and useful information.
The aim of the first two courses within the field of business economics - Finance and Financial Management I and II - is to provide the students with essential basic knowledge and skills, so that they can take part in discussions on problems in business economics and carry out simple analyses within the field, make correct decisions and communicate the results of the analyses in a comprehensible manner.
Finance and Managerial Accounting II builds on Finance and Managerial Accounting I. The aim of the course is to give the students further knowledge and understanding of important methods, techniques and theories for investment decisions and in managing commercial enterprises. The course consists of three subject areas. The finance area focuses on how uncertainty affects decisions on the basis of which investments should be made (the risk and return on individual projects and portfolios) and owners’, creditors’ and companies’ capital costs. The managerial accounting model area includes cost estimates and actual cost calculations on a unit level, performance reports for the whole company and for various levels, as well as budget supervision/variance analysis for costs, revenues and result. The special decision-making problems area focuses on how optimal decision-making is related to the concrete situation of the company.
After taking the course, the students shall be able to explain key concepts and give an account of important tools used in analyses of business economics problems (tools include connections, methods, techniques, models, theories, etc. applied in the subject area).
- Examples of concepts that students shall be able to explain: variance, standard deviation, expectation, efficient portfolios, risk aversion, bonds, market efficiency, risk premium, free capacity
- Examples from the toolbox: capital asset pricing model, portfolio theory, cost estimates, actual cost calculations, variance analysis
After taking the course the students shall be able to (apply knowledge (i.e. concepts and tools) in analyses and discussions of business economics problems, (b) distinguish between relevant and irrelevant information, and (c) give written answers to questions so that the readers understand the applied method and the conclusion. Examples:
- When the tool is given, be able to apply the tool correctly
- Based on simple situation descriptions, choose the right tools and apply them correctly
- Based on more complex situation descriptions, be able to produce relevant information, link it to the suitable tool and apply the tool correctly.
After taking the course, the students shall be able to ask critical questions and reflect on crucial assumptions and theories within the business economics field.
Finance and Managerial Accounting I or equivalent.
Bredesen, Ivar. 2011. Investering og finansiering. 4. utg. Gyldendal akademisk
Sending, Aage. 2014. Økonomistyring 2. 2. utg. Fagbokforlaget
Bredesen, Ivar. 2011. Hjelper til investering og finansiering. 4. utg. Gyldendal akademisk
Sending, Aage. 2014. Arbeidshefte til Økonomistyring 2. 3. utg. Fagbokforlaget
The course consists of three parts (tentative weighting is given in brackets).
Part 1: Managerial Accounting models
- Traditional models of calculation and managerial accounting
- Normal costing and normal cost accounts
- Standard costing and standard cost accounts
- Contribution margin and full costing
- Cost estimates and ex post costing
- Budget supervision
- Variance analysis for costs and revenues
Part 2: Some special decision problems
- Decision-relevant costs and income
- Product mix with scarce resources
Part 3: Investment and financing
- More on project analysis
- Introduction to uncertainty
- Relevant risk and portfolio theory
- Cost of capital and risk
- Follow-up and control
It is recommended that students use spreadsheets (e.g. Excel) when working with problems and assignments. It's Learning must be used for submitting the mandatory mini-exercises.
Learning process and workload
The course consists of lectures, assignment reviews by the lecturer, and self-tuition (reading the syllabus and doing exercises/assignments that are both mandatory and voluntary). Each student must hand in eight mandatory assignments.
Recommended workload in hours
|Participation at lectures||
|Preparation for lectures and work on mandatory assignments/coursework requirements||
|Preparation for exams||
|Total recommended use of time||
The plenary sessions will consist of lectures on parts of the syllabus and review of assignments. Students are expected to work on those parts of the syllabus that are not covered by the lectures or the assignment reviews. The lectures and assignment reviews are based on students having prepared for the lectures (i.e. that the students have read the syllabus and have solved the assignments before the lectures start).
Coursework requirements (mandatory exercises)
There are 8 mandatory exercises during the semester of which students must get approved 5. The totalt workload related to mini-exercises will be from 15 to 20 hours for students that have followed the recommended work schedule. The mini-exercises are to be submitted through It's Learning.
A minimum level of performance will be required for the mini-exercises to be approved (e.g. a minimum number of questions must be correctly answered). Further information will be given through It's Learning.
The e-learning platform It’s Learning is used by the e-learning centre to administrate the mandatory exercises, and make students able to communicate with each other and the Lecturer. Module sessions are carried out at the beginning of the semester and before exams. The e-learning students are also offered a study guide that is an educational guide to the syllabus.
Recommended workload in hours
|Participation at lectures (weekend sessions)||
|Preparation for lectures||
|Work on syllabus, study guide, assignments and exercises/activities on It's Learning||
|Preparation for the exam||
|Recommended total workload||
Students must get approved five of the eight mini-exercises in order to take the exam.
A five-hour written exam concludes the course.
BØK 34211 – written exam which accounts for 100% of the grade in the course BØK 3421 Finance and Managerial Accounting Il, 7.5 ECTS credits.
Examination support materials
Interest tables and a BI-defined exam calculator are allowed. TEXAS INSTRUMENTS BA II Plus™
Definitions of examination support materials in connection with written school examinations are available on @BI. Please note what is said about the use of calculator and dictionary. https://at.bi.no/EN/Pages/Exa_Hjelpemidler-til-eksamen.aspx
The course will be lectured for the last time at BI Online and part-time in the spring of 2015.
Re-sit examiniations are offered autumn 2015 and spring 2016.