ISE 304 Principles of Industrial Costing

Catalog Description
Introduction to basic costing concepts and behavior, with emphasis on manufacturing optimization through labor and materials cost analysis, operation and overhead cost calculations, product cost estimating, and finally setting product selling price. Study of the principles of costing systems and techniques of analysis and cost control. Emphasis on interpretation and use of costing principles for decision making.

Schedule of Topics

Topic	Number of lectures
Introduction to industrial costing	3
Manufacturing cost concepts and behavior	4
Manufacturing cost estimation	2
Manufacturing labor cost analysis	6
Materials cost analysis	6
Materials cost policies	3
Manufacturing overhead calculations	4
Product cost estimating	5
Operation cost estimating	5
Costs in nondiscrete production	2
Production Budgeting and Performance Reports	5
Engineering contracts	3

Objective and Outcomes

The Objective of ISE 304 is to introduce students to costing principles through an exploration of concepts, tools, and techniques from an engineering perspective so as to:
1. gain the necessary knowledge about the manufacturing economics principles and concepts;
2. understand and apply different methods of product pricing; and
3. work in teams and communicate effectively through class discussions and presentations.
The Outcomes expected from ISE 304 are:
1. an understanding of the common terms which comprise the language of costing;
2. an understanding of how costing components are recorded, classified, and summarized;
3. an understanding and applying different methods of manufacturing labor and material cost analysis;
4. knowledge of different ways for calculating the manufacturing overhead cost and know how to use them;
5. attainment of the necessary knowledge about the process costing and job costing and apply various operation and product cost estimating techniques;
6. an ability to understand, interpret, and use costing as a basis for managerial information support and decision-making;
7. understand production budgeting and know how to write production budgeting and performance reports; and
8. understand engineering contracts and know how to write engineering contracts

Method Of Instruction
Three 50- or two 75-minute lectures will be presented each week. Class sessions will be used to (1) present costing concepts, (2) provide insights into their use, and (3) answer questions regarding course material and/or homework assignments. Three examinations will be given, each examination covers one third of the course. Homework will be assigned systematically. An extra credit group study is offered which should be submitted, after the proposal is accepted, on Wednesday January 27, 2010. An in-class seminar will be required for field studies.

Method of assessment
A student's course grade will be weighted based on total points accumulated as defined by the following table.

Exam 1 on Monday December 12	20
Exam 2	25
Homework	15
Online discussion	20
Teaching presentation	20
Extra credit group study	maximum of 15
Total Points Available	100

Online discussion evaluation

Category	Initiation of new threads	Responses in threads	Discussion diversity in the main discussion groups
Assessment	Every new thread is assigned half a point, with a maximum of 6 points	One point is assigned to every 3 responses, with a minimum of 4 responses and a maximum of 6 points	Every discussion group is assigned 1 point, with a maximum of 8 points

Instructions:

Initiation of new threads means that you start a new topic for discussions in any of the main discussion groups: Discussion on the course topics, Study advice, Books for further reading, Solutions of the sample exams and quizzes, Course dictionary, Websites relevant to the course, Fields of industrial engineering, How the course can be more interesting, Websites about the industrial sector in Saudi Arabia (whether it is about census, not well known products, pictures, etc).
Responses in threads will require you to respond and participate in the discussions started by others.
Diversity in the discussions are also counted. There are 9 main discussion groups. You are required to distribute your discussion contributions among these groups.
Discussions have to be meaningful, add value, be well thought of, and advance the discussion.

Exam and quiz policy

Exams and quizzes will be held as scheduled, which should be announcing well in advance. Therefore, any kind of makeup will not be offered as an alternative to the scheduled exam or quiz.

Exam samples

Course case studies

Basic formulas

Additional readings on cost estimation

Video clips from youtube.com

CFL Lamp Assembly Line And Aging Line shows a typical assembly line and the manual operations involved in the assembly

Course Contribution to ABET Program Outcomes

#	Course Outcomes	Method of Assessment*	Program Outcomes
i	Understand the common terms which comprise the language of costing;	H, Q	a, e, g, k
ii	understand how costing components are recorded, classified, and summarized;	H, Q, E	a, e, g, k
iii	understand and apply different methods of manufacturing labor and material cost analysis;	H, Q, E, C	a, e, g, k
iv	know different ways for calculating the manufacturing overhead cost and know how to use them;	H, Q, E, C	a, e, g, k
v	gain the necessary knowledge about the operation and product cost estimating and apply various operation and product cost estimating techniques;	H, Q, E	a, e, g, k
vi	be able to understand, interpret, and use costing as a base for managers information support and decision- making.	H, Q, E, C	a, e, g, k
vii	understand production budgeting and know how to write production budgeting and performance reports;	H, Q, E, C	a, e, g, k
viii	understand engineering contracts and know how to write engineering contracts	H, Q, E, C	a, e, g, k

* Method of Assessments: H: Homework, Q: Quizzes, E: Exams, C: student initiated case study

Industrial and Systems Engineering Program Learning Outcomes

The graduates of the ISE program should have the ability to:

Apply knowledge of mathematics, science, and engineering;
design and conduct experiments, as well as analyze and interpret data;
design and improve integrated systems of people, materials, information, facilities, and technology;
function as a member of a multi-disciplinary team;
identify, formulate, and solve industrial and systems engineering problems;
understand and respect professional and ethical responsibility;
communicate effectively both orally and in writing;
understand the impact of engineering solutions in a global and societal context;
recognize the need for life-long learning, and an ability to engage in it;
have a knowledge of contemporary issues;
use updated techniques, skills and tools of industrial and systems engineering throughout their professional careers.

Mapping between course objectives and program outcomes

	Objectives
Outcomes	1	2	3
a	√	√	√
b
c	√	√	√
d
e	√	√
f	√
g	√	√
h	√
i
j	√	√
k	√	√

Prerequisites
Calculus I, Junior Standing

References

Lecture notes
Cost Analysis and Estimating for Engineering and Management, by Ostwald and McLaren, Pearson Education
Fundamentals of Cost Accounting, by M. Maher, W. Lanen, M. Rajan, McGraw Hill

Instructor
Dr Muhammad Al-Salamah, office 22-436, phone 1627

Institution
King Fahd University of Petroleum and Minerals

Office hours for general question in the course
Saturdays and Mondays and Wednesdays from 10 to 11 am.

Teaching presentation help hours
These hours are for the teaching presentation groups who might need assistance in there topics and presentations. I will be in my office, by appointment only, every day from 2 to 3 pm. Everyone is advised to book a slot the day before the day of the meeting.

Teaching presentation groups

Labor cost analysis by Meshal Al-Suhaibani, Omar Al-Jabri, Yazid Al-Mubarak, Turki Bin Zarah
Material cost analysis by Hani Binmahfooz, Yaser Al-Salmi
Manufacturing overhead by Omar Ballouli and Abdullah Al-Sagaoub
Product cost estimating by Hamad Binahmed and Ismail Al-Maraj
Operation cost estimating and nondiscrete products cost by Saleh Al-Mansouri, Abdullah Ahmetoglu, Mohammad Al-Asiri

الوصف: مقدمة في المفاهيم الأساسية لحساب التكاليف في النظم الصناعية و طبيعتها، مع التركيز على تحسين الأداء من خلال تحليل تكاليف المواد الخام واليد العاملة، وتقدير تكلفة المنتج، وأخيرا تحديد سعر بيع المنتج. دراسة لتحديد التكاليف ومبادئ ونظم وأساليب التحليل ومراقبة التكاليف. التركيز على تفسير واستخدام مبادئ تقدير التكاليف اللازمة لاتخاذ القرارات.

المادة: مبادئ حساب التكاليف الصناعية
مدرس المادة: الدكتور محمد بن فهد السلامة

برنامج الهندسة الصناعية و النظم
قسم هندسة النظم
جامعة الملك فهد للبترول و المعادن

Fall 2008 class
Husam Aalem, Mahmoud Ajaimi, Wayel Al-Amri, Mazen Al-Anazi, Ahmad Al-Daalouj, Ahmad Al-Darwaish, Murtada Al-Doukhi, Humoud Al-Duaij, Fahad Al-Faadhel, Ibrahim Al-Furaih, Ayman Al-Ghamdi, Khaled Al-Ghufaili, Manea Al-Ghufaili, Mohammad Al-Harbi, Ahmad Al-Hayek, Hassameldeen Al-Jabaili, Ahmad Al-Khuwaiter, Abdallah Al-Muhanna, Muhammad Al-Radhwan, Ibrahim Al-Ramah, Ali Al-Suwaiyed, Moath Al-Swaidan, Rayed Al-Thubaiti, Faisal Al-Tuwaijri, Saud Al-Wagdani, Fahd Al-Yousef, Abdullah Dehwah, Rami Hajjar, Fareed Hussain, Abdul-Hadi Khalifah, Qasim Khan, Rizwan-Ul-Hasan Khan, Aamer Saati, Muhammad Zumah

Spring 2008 class
Mustafa Al-Abdul-Aziz, Muhammad Al-Abkari, Fahad Al-Ageel, Abdullah Al-Ahmadi, Fares Al-Anazi, Ahmad Al-Askar, Ali Al-Awazam, Basheer Al-Baharnah, Ziyad Al-Battah, Faisal Al-Dowairi, Abdul-Aziz Al-Fahd, Bader Al-Ghamdi, Saeed Al-Hajri, Bader Al-Hamed, Abdullah Al-Hamsh, Bader Al-Harbi, Raad Al-Harbi, Abdulaziz Al-Hazzaa, Meshari Al-Jabr, Abdullah Al-Mubarak, Jazaa Al-Mutairi, Feras Al-Ogeil, Mohammad Al-Rabdi, Husain Al-Satrawi, Basel Al-Senan, Mohammad Al-Shaikh, Sarhan Al-Shammari, Ahmad Al-Shareef, Zaid Al-Shareef, Tariq Al-Sharif, Gharmallah Al-Zahrani, Omar Ba-Duraig, Ahmad Bakr, Marwan Balbaid, Hisham Bashammakh, Rami Ba-Yazid, Ahmed Binghashiyan, Fouad Farhat, Abdul-Rahman Nukhaifi, Ali Ragheb, Mohammad Yagout

Summer 2008 class
Bader Abu Sulaiman, Abdul-Rahman Al-Abdul-Wahab, Saud Al-Ahmari, Muad Al-Beshr, Fahad Al-Ghamdi, Owais Ali, Abdullah Al-Khalifah, Ziyad Al-Muhaimid, Abdulrahman Al-Shammari, Abdul-Rahman Al-Thunaiyan, Ahmed Ben Daya, Talal Bukhari, Adel Fadhl, Ibrahim Hammam, Al-Bara Mousa, Fadi Omar, Mahmoud Sheblag

صف الفصل الاول عام 2008
حسام عالم، محمود عجيمي، وائل العمري، مازن العنزي، احمد الدعلوج، احمد الدرويش، مرتضى الدوخي، حمود الدعيج، فهد الفاضل، ابراهيم الفريح، ايمن الغامدي، خالد الغفيلي، منيع الغفيلي، محمد الحربي، احمد الحايك، حسام الدين الجبيلي، عبدالعزيز الجميعة، احمد الخويطر, عبدالله المهنا، محمد الرضوان، ابراهيم الرماح، على السويد، معاذ السويدان، رائد الثبيتي، فيصل التويجري، سعود الوجداني، فهد اليوسف، عبدالله الدحوي، رامي حجار، فريد حسن، عبدالهادي خليفه، قاسم خان، رضوان الحسن خان، عامر سعاتي، محمد زومه

صف الفصل الثاني عام 2008
مصطفى العبد العزيز، محمد الابكري، فهد العقيل، عبد الله الاحمدي، فارس العنزي، احمد العسكر، علي العوازم، بشير البحارنة، زياد البطاح، فيصل الدويري، عبد العزيز الفهد، بدر الغامدي، سعيد الهاجري، بدر الحامد، عبدالله الهمش، بدر الحربي، رعد الحربي، عبد العزيز الهزاع، مشاري الجبر، عبد الله المبارك ، جزاع المطيري، فراس العقيل، حسين الستراوي، باسل السينان، محمد الشيخ ، سرحان الشمري ، أحمد الشريف ، زيد الشريف ، طارق الشريف، غرمالله الزهراني، عمر بادريق، احمد بكر، مروان بالبيد، هشام باشماخ، رامي بايزيد، أحمد بن غشيان، فؤاد فرحات، عبد الرحمن نخيفي، علي راغب ، محمد ياقوت

صف الفصل الصيفي 2008
بدر ابوسليمان ، عبد الرحمن العبدالوهاب ، سعود الأحمري ، معاذ البشر ، فهد الغامدي ، عويس علي ، عبد الله الخليفة ، زياد المحيميد ، عبدالرحمن الشمري ، عبد الرحمن الثنيان ، أحمد بن دايه ، طلال بخاري ، عادل فضل ، ابراهيم همام ، البراء موسى ، فادي عمر ، محمود شبلاق