Financial Management: Management Accounting is a comprehensive and application-oriented textbook designed to provide a clear understanding of financial analysis, planning, and decision-making in business. The book introduces the fundamental concepts of management accounting, highlighting its scope, objectives, tools, and importance in supporting managerial functions.
It covers essential topics such as financial statement analysis, including balance sheets and income statements, along with techniques like trend analysis, comparative statements, common-size statements, and ratio analysis. The book also explains key concepts of marginal costing, such as contribution, profit-volume ratio, break-even point, and margin of safety, supported by practical problem-solving approaches.
In addition, it explores budgeting and budgetary control, including different types of budgets and capital budgeting techniques. The content is presented in a clear, structured, and practical manner, with examples and exercises that enhance conceptual clarity and analytical skills. This book serves as a valuable resource for learners aiming to develop strong financial decision-making abilities in a business environment.
1. Introduction
1.1 Meaning and Emergence of Management Accounting - Definition of Management Accounting
1.2 Characteristics of Management Accounting - Scope of Management Accounting
1.3 Objectives of management accounting - Functions of Management Accounting
1.4 Management accounting Vs Financial Accounting
1.5 Management accounting Vs Cost accounting
1.6 Tools and techniques of Management Accounting
1.7 Need and Importance of Management Accounting
1.8 Advantages and Limitations of Management Accounting
2. Financial Statement Introduction and Analysis
2.1 Introduction to Financial Statements
2.2 Analysis and Interpretation of Financial Statements
2.2.1 Balance Sheet (Statement of Financial Position)
2.2.2 Relationship between items in Balance Sheet and Revenue statement
2.3 Methods of Financial Statement Analysis
2.3.1 Trend Percentage Analysis
2.3.2 Comparative Financial Statements
2.3.3 Common Size Statements
2.4 Introduction to Ratio Analysis
2.4.1 Advantages and limitations
2.4.2 Types of ratios-profitability ratios
2.4.3 Liquidity Ratios
2.4.4 Activity Ratios
2.4.5 Leverage Ratios
2.5 Practical problems on following ratios: Current Ratio, Liquid Ratio, Stock Working Capital Ratio, Proprietary Ratio, Debt Equity Ratio, Gross Profit Ratio, Operating Ratio & Net Operating Profit Ratio, Net Profit Ratio, Stock Turnover Ratio, Return on capital employed, Return on proprietor's Fund, Debtors Turnover, Creditors Turnover
3. Marginal Costing
3.1 Marginal Costing
3.2 Advantages of Marginal Costing
3.3 Limitations of Marginal Costing
3.4 Contribution
3.5 Profit Volume Ratio (P/V Ratio)
3.6 Break-Even Point (BEP)
3.7 Margin of Safety (MOS) : Problems on Contribution, P/V Ratio, BEP, and MOS
4. Budgeting and its Control
4.1 Budget and Budgetary control: meaning, definition, role of budget and budgetary control in an organization: steps and advantages
4.2 Types of Budgets: as per time, functions and variability
4.3 Practical question on Cash Budget
4.4 Capital budgeting: Introduction, classification of capital budgeting projects, capital budgeting projects, Capital budgeting techniques with its advantages and disadvantages- Payback Period and Accounting Rate of Return Practical questions on Payback and Accounting rate of return
BBA | Second Year
Semester – III, Major
This textbook is aligned with the revised syllabus as outlined by the National Education Policy 2020 (NEP 2020) for the Faculty of Commerce & Management Bachelor of
Business Administration (BBA), effective from June 2025.
