Profit reconciliation

Unit 6: Accounting for Profit PlanningTopic 3 of 6

Browse the Cost and Management Accounting syllabus

Cost and Management Accounting

8 units

1 Conceptual Foundation
2 Accounting for Materials
3 Accounting for Labour Cost
4 Accounting for Overhead Cost
5 Costing in Different Situations
6 Accounting for Profit Planning
7 Cost Accounting for Planning and Control
8 Cost Reduction

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What the syllabus expects

Reconcile absorption- and variable-costing profit or loss
Explain causes of differences

Profit reconciliation

Bachelor of Business Studies (BBS) — Second Year

Subject: Cost and Management Accounting (MGT 212)

Unit 6: Accounting for Profit Planning

Academic Year: 2083/84

Topic Objectives

After studying this topic, students should be able to:

Explain the scope and key elements of profit reconciliation.
Prepare the relevant cost records or calculations and interpret their use in managerial planning and control.

Curriculum Scope

Reconcile absorption- and variable-costing profit or loss
Explain causes of differences

Detailed Microsyllabus

Causes of profit differences
1. Fixed manufacturing overhead carried in opening and closing stock.
2. Production relative to sales.
3. Overhead-rate and adjustment effects.
Reconciliation
1. Start with either prescribed profit figure.
2. Add or deduct the relevant inventory-related overhead effects.
3. Check agreement and explain each reconciling item.

Curriculum reference: Tribhuvan University, Faculty of Management, revised four-year BBS curriculum, PDF pages 31-34.

Source note: The curriculum scope above is retained from the existing TU syllabus breakdown. The numbered study subtopics are editorial elaborations for teaching and study, rather than a separately issued TU syllabus. Unit or component allocations apply at their stated level; no separate topic hours or marks are assigned here.