Category: Maybe it’s just me, but I’m having a hard time understanding where microeconomics ends and cost accounting begins.
It’s been a little over a week since I returned back from Russia, and today I decided to revisit the material we learned at the residency. Given that this week has the mid-term exam, I figured I’d start out with doing the assigned textbook readings, starting with pre-reading I never completed! Funny how that works out…
Cracking the textbook, I couldn’t even remember where I left off between chapters 1-3. As you can see, I’ve taken full advantage of the week-long break! So I started with chapter 3, Cost-Volume-Profit analysis, and I damn near resumed my Entourage season 5 viewing…well over half, to almost the entire chapter is how to manipulate a basic algebra formula! I pushed through, figuring that the first 3 chapters of any textbook should be pretty easy. Chapter 4, Fundamentals of Cost Analysis for Decision Making, could be summed up in one sentence: In the short-run, only variable costs matter; the shorter the time period, the more costs can be considered ‘fixed’.
No disrespect to the Professor (who is fantastic, btw), but so far this almost seems to be too easy to be an undergraduate class. But by the same token, I’m a bit scared for the mid-term. You might be asking, “Why, Mr. Know-it-All, if everything is so basic?,” and therein lies the rub: I just can’t focus on repetitive material. After undergraduate Accounting (2), Economics (several), graduate Economics (too many), MBA Accounting (1) and Economics (1)…reviewing Profit= Total Revenue – Total Cost with any enthusiasm is just too difficult after a long day at work.
Following the syllabus and skipping chapter 5 on cost estimation (I guess that’s some lackey’s job, not the manager!), chapter 6 outlines how and why to set up a cost accounting system properly. I’ll have to leave that until tomorrow. Perhaps I need to switch my study time to before work so I can have some focus…
Update 7/23 – Chapters 6 and 9 are no better. Only 3 more to go, and bunch of case readings/questions, some articles, then the practice exam. Basically, a long way to go before Sunday afternoon.
That's what scares me Syed. I feel like all of the residency and all of the textbook readings are basically just feel good info about why the 'true' cost of everything always 'depends'.
I like the concept of Accounting, but I hate the half quantitative, half arbitrary nature.
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