Susan Swan Forsyth

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About the Course

Business 112 Financial Accounting is a 4 unit course with no prerequisite.  There are four lecture hours weekly.
Course Description
An introduction to accounting practice, principles, and analysis. This course is basic for students in accounting, business administration, economics, law, and other professions. It covers the accounting cycle for a service enterprise and for a merchandising enterprise, preparation of financial statements, internal control, valuation of receivables, depreciation and fixed asset disposal, debt structure, corporate capitalization and retained earnings, and finishing with a thorough discussion of financial statement analysis

Course Objectives and Critical Thinking
The student will have an understanding of the conceptual framework of accounting, the assumptions, principles and constraints of Generally Accepted Accounting Principles, and the role of the Financial Accounting Standards Board in today's accounting atmosphere.  The student will be able to carry out the tasks of a full charge bookkeeper and make the appropriate year-end adjusting entries.  Furthermore, the student will be able to prepare and communicate to the external reader the four basic financial statements; balance sheet, statement of earnings, statement of stockholders' equity, and cash flow statement. Students will develop skills in problem solving through a series of problems requiring them to identify, evaluate, and solve the problem. Many problems will require the student to exercise professional judgment in both the development and interpretation of accounting information

Student Learning Outcomes
At the conclusion of this course, the student should be able to:
1. Explain the nature and purpose of generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS). Explain and apply the components of the conceptual framework for financial accounting and reporting, including the qualitative characteristics of accounting information, the assumptions underlying accounting, the basic principles of financial accounting, and the constraints and limitations on accounting information;
2. Define and use accounting and business terminology; 
3. Explain what a system is and how an accounting system is designed to satisfy the needs of specific businesses and users; summarize the purpose of journals and ledgers; 
4. Apply transaction analysis, input transactions into the accounting system, process this input, and prepare and interpret the four basic financial statements; 
5. Distinguish between cash basis and accrual basis accounting and their impact on the financial statements, including the revenue recognition and matching principles; 
6. Identify and illustrate how the principles of internal control are used to manage and control the firm?s resources and minimize risk; 
7. Explain the content, form, and purpose of the basic financial statements (including footnotes) and the annual report, and how they satisfy the information needs of investors, creditors, and other users; 
8. Explain the nature of current assets and related issues, including the measurement and reporting of cash and cash equivalents, receivables and bad debts, and inventory and cost of goods sold; 
9. Explain the valuation and reporting of current liabilities, estimated liabilities, and other contingencies; 
10. Identify and illustrate issues relating to long-term asset acquisition, use, cost allocation, and disposal; 
11. Distinguish between capital and revenue expenditures; 
12. Identify and illustrate issues relating to long-term liabilities, including issuance, valuation, and retirement of debt;(including the time value of money) 
13. Identify and illustrate issues relating to stockholders equity, including issuance, repurchase of capital stock, and dividends; 
14. Explain the importance of operating, investing and financing activities reported in the Statement of Cash Flows; 
15. Interpret company activity, profitability, liquidity and solvency through selection and application of appropriate financial analysis tools; and 
16. Identify the ethical implications inherent in financial reporting and be able to apply strategies for addressing them. 

Method of Instruction
The class will be a mix of lecture, problem-solving activities and quizzes.  The student will need access to a computer in order to access the class website, do homework and extra credit, take chapter online quizzes, and receive emails. Class attendance is strongly encouraged but not mandatory.  There are no points assigned for participation.  However, I will call on students whether or not they volunteer to answer a question. Each class, students are expected to work on the homework assigned in order to input it successfully at home using the My Accounting Lab online program.  Students can expect homework of approximately 2.5 hours a week to read the chapter assigned and do the homework, and an hour every two weeks in order to complete the on-line quiz.  There is additional time spent if the student chooses to do extra credit problems. There are no group work/projects/presentations.
Students are responsible adults with busy lives.  I do not have an issue with students coming late to class/missing class with the understanding that homework/quiz/extra credit deadlines are adhered to without exception. If the student will be missing more than one class, the student should discuss this with me.  I drop/withdraw a student at certain intervals during the semester if it appears that the student is no longer participating.  Participation is defined as a combination of completed work, quizzes and class attendance.

Textbooks and Materials
See the Course Syllabus or Textbook/Materials section of this website.

The schedule of assignments/quizzes and their respective deadlines are shown at Due Dates - IVC or Kentfield on this website or on the Course Syllabus.   Submission criteria for assignments and quizzes is covered in the Course Syllabus and at FAQ. The topics covered (by chapter) is shown in the outline below. There is no midterm or final exam.  Drop-dates are shown at Important Dates on this website.

The activities which will be graded, and their respective weights is shown in the Course Syllabus.  I use points rather than grades with each type of assignment earning a possible maximum as shown in the Syllabus.  The deadline for Pass/No Pass grade option is shown in the Syllabus and at Important Dates on this website

Lecture Content
1. Purposes and uses of accounting information
2. The accounting cycle
3. Cash and accrual accounting
4. Internal controls
5. Financial reporting rules and disclosure, including International standards, such as International Financial Reporting Standards (IFRS)
6. Current assets
7. Current liabilities
8 Long-term assets
9. Long-term liabilities
10. Stockholders equity and reporting requirements
11. Measuring cash flow
12. Financial statements and statement analysis
13. Ethical issues
Course Content
Business 112 Financial Accounting Textbook: Financial and Managerial Accounting - The Financial Chapters, 5th edition by Miller-Nobles, Mattison, Matsumura. Publisher: Pearson
This content is located in the following textbook chapters of the above text:
  1. Accounting and the Business Environment
    1. Nature of accounting 
    2. Organizations and rules that govern accounting
    3. Accounting equation and  transaction analysis
    4. Financial statements and return on assets
  2. Recording Business Transactions
    1. Using accounts and the double-entry accounting system
    2. Recording transactions
    3. Trial Balance
    4. Debt ratio
  3. The Adjusting Process
    1. Cash vs. Accrual basis
    2. Concepts and Principles applicable to accrual basis
    3. Adjusting entries
    4. Adjusted trial balance
    5. Impact of adjusting entries on financial statements
  4. Completing the Accounting Cycle
    1. Accounting Cycle
    2. Preparing financial statements
    3. Closing entries
    4. Current ratio
  5. Merchandising Operations
    1. Nature of merchandising business
    2. Merchandising transactions and financial statements
    3. Adjusting and closing process
    4. Gross Profit percentage
  6. Merchandise Inventory
    1. Accounting principles and control of inventory
    2. Valuation of inventory using different cost flow systems, lower of cost or market.
    3. Adjusting entry for merchandise inventory
    4. Inventory turnover and days' sales in inventory
  7. Internal Control and Cash
    1. Internal Control and Sarbanes Oxley
    2. Objectives, elements, and application of internal controls
    3. Internal controls over cash receipts/disbursements
    4. Bank reconciliations and special purpose cash funds
    5. Cash ratio
  8. Receivables
    1. Types of receivables and credit sales
    2. Accounting for uncollectible accounts
    3. Notes receivable
    4. Financial statement reporting of receivables
    5. Acid test, Accounts receivable turnover and days' sales in receivables
  9. Plant Assets, Natural Resources and Intangible Assets
    1. Measuring the cost of a plant asset
    2. Depreciation methods
    3. Disposal of fixed assets
    4. Natural resources and intangible assets
    5. Asset turnover ratio
  10. Investments
    1. Accounting for debt and equity investments
    2. Value and reporting investments
    3. Rate of return on total assets
  11. Current Liabilities and Payroll
    1. Current liabilities
    2. Payroll and payroll taxes
    3. Accounting systems for payroll and payroll taxes
    4. Employees' fringe benefits and contingent liabilities
    5. Times interest earned ratio
  12. Long-Term Liabilities
    1. Notes payable and mortgages payable
    2. Bonds payable
    3. Reporting long-term liabilities
    4. Debt to Equity Ratio
  13. Stockholders Equity
    1. Issuing stock
    2. Dividends/ Stock Splits
    3. Treasury Stock
    4. Reporting stockholders equity
    5. Stockholders equity ratios
  14. Statement of Cash Flows
    1. Reporting cash flows
    2. Statement of Cash Flows - indirect method
    3. Free cash flow
  15. Financial Statement Analysis
    1. Horizontal and vertical analysis
    2. Ratio analysis

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    Last Modified: Wednesday, January 11, 2017
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