AE302010 - Business economics


Examination arrangement

Examination arrangement: Written examination
Grade: Letters

Evaluation form Weighting Duration Examination aids Grade deviation
Written examination 100/100 4 hours D

Course content

- Cost-Volume-Profit analysis
- Job costing /costing techniques (also Activity-based costing)
- Budgets, flexible budgets with direct-cost variances and overhead cost variances
- Inventory costing and capacity analysis
- Estimation of cost functions using quantitative methods
- Decision making and relevant information
- Strategy, balanced scorecard and strategic profitability analysis
- Price decisions and cost management
- Cost allocation
- Customer-profitability analysis and further analysis of sales-volume variance
- An introduction to process costing
- Inventory management focusing on EOQ model
- Capital budgeting and performance measurement
- Transfer pricing and Management control systems

Learning outcome

- have knowledge of Cost-Volume-Profit analysis
- have knowledge of various costing methods with emphasis on Activity-based costing (ABC)
- have knowledge of static budget, flexible budget and variance analysis
- have knowledge of absorption and variable costing for computing income
- have knowledge of various methods of cost estimation
- have knowledge of relevant information in decision situations
- have knowledge of Balanced Scorecard and strategic profitability analysis
- have knowledge of factors that affect pricing decisions and various methods of long-run pricing decisions
- have knowledge of methods of cost allocation in various situations
- have knowledge of customer-profitability analysis and further analysis of sales-volume variance
- have insight into process costing
- have knowledge of EOQ model for inventory management
- have knowledge of capital budgeting, transfer pricing and various performance measures

- perform various calculations in connection with Cost-Volume-Profit analysis
- perform cost calculations focusing on Activity-based costing, as well as evaluate benefits and disadvantages of Activity-based costing systems
- develop flexible budget as well as calculate and analyze direct-cost variances and overhead cost variances
- compute income under absorption costing and variable costing, explain the difference in income, as well as carrying out appropriate analysis
- discuss the appropriateness of various cost allocation bases
- determine appropriate cost drivers, also by means of the regression analysis
- be able to distinguish relevant from irrelevant information in decision situations
- analyze the impact of various strategic choices
- be able to apply methods for long-run pricing decisions, as well as discuss different pricing strategies including internal pricing
- conduct various cost- and revenue allocation between units/departments, products and customers
- be able to conduct customer-profitability analysis
- be able to carry out inventory calculations within the EOQ decision model
- discuss the properties of different performance measures (financial and non-financial), as well as calculate and analyze financial performance measures

General competence:
- acquire updated knowledge in the subject
- communicate about issues relevant to the subject and be able to conduct appropriate analyses and to draw conclusions on relevant issues.

Learning methods and activities

Teaching methods:

Lectures and problem solving. The learning management system Blackboard will be used to some extent in the exchange of information.  

Mandatory Assignments:

One compulsory paper must be handed in for assessment. Completion of this paper requires the use of ICT tools (eg. Excel). This paper must achieve a pass in order for a candidate to take the exam. Students who had approved mandatory assignments earlier are exempt from mandatory work requirements for later continuation exams.

Compulsory assignments

  • Mandatory assignment

Further on evaluation

Supporting material allowed on exams: Calculator (none programable and without the ability to wirelessly communicate). Approved calculator regarding NTNUs support material code B-D "specific basic calculator". Other calculators that are allowed in the course are: Casio FC-100V and Texas Instruments - BAII Plus.

Specific conditions

Exam registration requires that class registration is approved in the same semester. Compulsory activities from previous semester may be approved by the department.

Required previous knowledge


Course materials


Datar, Rajan: Horngrens's Cost Accounting - A MANAGERIAL EMPHASIS (16th Ed), Pearson Education Limited (2018), ISBN: ISBN -13: 978-1-292-21154-1
The final information is given at the start of the semester.

More on the course



Version: 1
Credits:  7.5 SP
Study level: Third-year courses, level III


Term no.: 1
Teaching semester:  AUTUMN 2020

Language of instruction: Norwegian

Location: Ålesund

Subject area(s)
  • Economics and Administration
Contact information
Course coordinator:

Department with academic responsibility
Department of International Business



Examination arrangement: Written examination

Term Status code Evaluation form Weighting Examination aids Date Time Digital exam Room *
Autumn ORD Written examination 100/100 D 09:00
Room Building Number of candidates
Spring UTS Written examination 100/100 D 09:00
Room Building Number of candidates
  • * The location (room) for a written examination is published 3 days before examination date. If more than one room is listed, you will find your room at Studentweb.

For more information regarding registration for examination and examination procedures, see "Innsida - Exams"

More on examinations at NTNU