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Cooper (p. 23-32)

Kunz-Osborne (p. 33-41)

Coulmas-Law (p.42-46)

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JOURNAL OF ACCOUNTING AND FINANCE

A Case Method Approach of Teaching How Cost-Volume-Profit Analysis is

Connected to the Flexible Budgeting Process and Variance Analysis

Author(s): Susan Machuga, Carl Smith

Citation: Susan Machuga, Carl Smith, (2013) "A Case Method Approach of Teaching How Cost-Volume-Profit Analysis is Connected to the Flexible Budgeting Process and Variance Analysis," Journal of Accounting and Finance, Vol. 13, Iss. 6, pp. 178 - 192

Article Type: Research paper

Publisher: North American Business Press

Abstract:

To start a successful business, students need to understand the steps necessary to achieve their desired

profits. While Managerial textbooks teach each step independently, we demonstrate how these steps are

integrated. We present a Multi-Disciplinary Case-Method approach to teaching Cost-Volume-Profit

(CVP) Analysis. Students use their own assumptions to simulate a real-life business startup analysis to

calculate the number of units necessary to achieve their desired profits. Students are required to build

upon their CVP analyses to develop budgets necessary for planning and control purposes. Finally,

students prepare a Flexible Budget demonstrating the importance of distinguishing between activity and

revenue/spending variances.