ACCT 1070 - Accounting for Entrepreneurs

Credit Hours: 3.00

Objectives: Given a set of exam questions, the student will be able to:

1. Describe the purpose and content of each financial statement.
2. Analyze business transactions.
3. Account for major transactions involving assets.
4. Account for major transactions involving liabilities.
5. Account for major transactions involving equity.

Outcome 2: Upon completion of this course, students will be able to summarize management accounting information used to make business decisions.

Objectives: Given a set of exam questions, the student will be able to:

1. Compute ratio analysis of statements.
2. Describe the three primary types of business activities and cash flows.
3. Define different types of costs used in managerial accounting.
4. Compute cost-volume-profit analysis.
5. Explain the importance of the budget process

• Communication: The graduate can communicate effectively for the intended purpose and audience.
• Critical Thinking: The graduate can make informed decisions after analyzing information or evidence related to the issue.
• Global Literacy: The graduate can analyze human behavior or experiences through cultural, social, political, or economic perspectives.
• Information Literacy: The graduate can responsibly use information gathered from a variety of formats in order to complete a task.
• Quantitative Reasoning: The graduate can apply quantitative methods or evidence to solve problems or make judgments.
• Scientific Literacy: The graduate can produce or interpret scientific information presented in a variety of formats.

1. Describe the types and forms of businesses, how businesses make money, and business stakeholders.
2. Describe the three business activities of financing, investing, and operating.
3. Define accounting and describe its roll in business.
4. Describe and illustrate the basic financial statements and how they interrelate.
5. Describe eight accounting concepts underlying financial reporting.

Basic Accounting Concepts

1. Describe the basic elements of a financial accounting system.
2. Analyze, record, and summarize transactions for a corporation’s first period of operations.
3. Prepare financial statements for a corporation’s first period of operations.

Accrual Accounting Concepts

1. Describe basic accrual accounting concepts, including the matching concept.
2. Use accrual concepts of accounting to analyze, record, and summarize transactions.
3. Describe and illustrate the end-of-period adjustments process.
4. Prepare financial statements using accrual concepts of accounting, including a classified balance sheet.
5. Describe how the accrual basis of accounting enhances the interpretation of financial statements.

Accounting for Merchandising Businesses

1. Distinguish the activities and financial statements of a service business from those of a merchandising business.
2. Describe and illustrate the financial statements of a merchandising business.
3. Describe the accounting for the sale of merchandise.
4. Describe the accounting for the purchase of merchandise

Sarbanes-Oxley, Internal Control, and Cash

1. Describe the Sarbanes-Oxley Act and its impact on internal controls and financial reporting.
2. Describe and illustrate the objective and elements of internal control.
3. Describe and illustrate the application of internal controls to cash.
4. Describe the nature of a bank account and its use in controlling cash.
5. Describe and illustrate the use of a bank reconciliation in controlling cash.

Receivables and Inventories

1. Describe the common classifications of receivables.
2. Describe the nature of and the accounting for uncollectible receivables.
3. Describe the direct write-off method of accounting for uncollectible receivables.
4. Describe three inventory cost flow assumptions and how they impact the financial statements.
5. Compare and contrast the use of the three inventory costing methods.
6. Describe how receivables and inventory are reported on the financial statements.

Fixed Assets and Intangible Assets

1. Define, classify, and account for the cost of fixed assets.
2. Compute depreciation using the straight-line and double-declining-balance methods
3. Describe the accounting for intangible assets.
4. Describe how depreciation expense is reported on an income statement and prepare a balance sheet that includes fixed assets and intangible assets.

Liabilities and Stockholders’ Equity

1. Describe how businesses finance their operations.
2. Describe and illustrate current liabilities, notes payable, taxes, contingencies, and payroll.
3. Describe and illustrate the financing of operations through issuance of stock.
4. Describe and illustrate the accounting for cash and stock dividends.
5. Describe financial statement reporting of liabilities and stockholders’ equity.
6. Analyze the impact of debt or equity financing on earnings per share.

Financial Statement Analysis

1. Describe basic financial statement analytical methods.
2. Use financial statement analysis to assess the liquidity and solvency of a business.
3. Use financial statement analysis to assess the profitability of a business.
4. Describe the contents of corporate annual reports.

Accounting Systems for Manufacturing Businesses

1. Describe the differences between financial and managerial accounting.
2. Distinguish the activities of a manufacturing business from those of a merchandising or service business.
3. Define and illustrate materials, factory labor, and factory overhead costs.
4. Describe cost accountings systems used by manufacturing businesses.
5. Describe and illustrate a job order cost accounting system.
6. Use job order cost information for decision making.
7. Describe the flow of costs for a service business that uses a job order cost accounting system.

Cost Behavior and Cost-Volume-Profit Analysis

1. Classify costs as variable costs, fixed costs, or mixed costs.
2. Compute the contribution margin, the contribution margin ratio, and the unit contribution margin.
3. Determine the break-even point and sales necessary to achieve a target profit.

Differential Analysis and Product Pricing

1. Prepare differential analysis reports for a variety of managerial decisions.
2. Determine the selling price of a product, using the total cost, product cost, and variable cost concepts.

Budgeting and Standard Cost Systems

1. Describe budgeting, its objectives, its impact on human behavior, and types of budget systems.
2. Describe the master budget for a manufacturing company.
3. Describe the types of standards and how they are established.