CBA Pre-Core Course Objectives
The College of Business Administration Pre-Core Classes Include:
ECO 110, ECO 120, BUS 205, ACC 221, & ACC 222
Accounting 221 Course Objectives and Assessment Guidelines
ACC 221 Cr. 3 Accounting Principles I: Course description
An introduction to accounting as an information system. Emphasis is on reporting to external constituencies: investors, creditors, and governmental agencies. Topics include recording economic activities of the firm and the resultant financial reports, federal income taxation, and time value of money. Prerequisite: Students must have successfully completed a minimum of 12 credit hours.
Objective 1: Demonstrate a comprehensive knowledge of the complete accounting cycle, including recording, reporting, and basic application of generally accepted accounting principles.
Objective 2: Demonstrate a comprehensive knowledge of basic time-value-of-money concepts.
Objective 3: Identify relevant federal, state, and/or employment-tax issues as they apply in a financial accounting context.
Successful accomplishment of objective one is a prerequisite for success in accounting 221 and progression into accounting 222. The following assessment guidelines should be used to determine the student’s accomplishment of objective one. The accounting 221 student should:
(1)Demonstrate a comprehensive knowledge of financial statement components by correctly defining and classifying the following accounts: assets, liabilities, owner’s equity, revenues, expenses, gains, losses, dividends, and various contra-accounts.
(2) Apply the rules of double entry accounting to journalize transactions in chronological order.
(3) Organize recorded data by posting journal entries to specific accounts and determine account balances.
(4) Prepare a trial balance at various points in the accounting cycle to summarize data and test for errors.
(5) Analyze account data and journalize year-end adjustments.
(6) Journalize the year-end closing process.
(7) Prepare financial statements, including the income statement, statement of retained earnings, and balance sheet.
(8) Recognize and discuss the concept of articulation in financial statements.
(9) Apply generally accepted accounting principles and integrated financial statement integrity with respect to the following subject matter: cash and credit sales, receivables and bad debts, inventory, property, plant, & equipment, current liabilities, long-term debt, and equity. Subjects including the statement of cash flows, financial statement analysis, and investments may be omitted since they are covered in other courses.
Successful accomplishment of objective two is a prerequisite for success in accounting 221 and progression into accounting 222. The following assessment guidelines should be used to determine the student’s accomplishment of objective two. The accounting 221 student should:
(1) Identify appropriate applications of time-value-of-money concepts.
(2) Define relevant time-value-of-money variables including present value, future value, annuity payments, interest rates, and compounding periods.
(3) Set up and solve time-value-of-money problems in general and specifically with respect to appropriate accounting 221 subject matter including notes, bonds, mortgages, leases, and investments.
(4) Demonstrate an understanding of effective interest amortization.
Successful accomplishment of objective three will enhance the student’s conceptual understanding of the tax consequences of financial transactions. The following assessment guidelines should be used to determine the student’s accomplishment of objective three. The accounting 221 student should:
(1) Recognize the existence of tax consequences with respect to financial transactions.
(2) Distinguish between different tax applications including sales, unemployment, social security, state and federal income taxes.
(3) Distinguish between different tax rates and tax bases.
(4) Distinguish between the Internal Revenue Code for determining taxable income and Generally Accepted Accounting Principles for determining financial income.
Accounting 222 Course Objectives
ACC 222 Cr. 3 Accounting Principles II: Course description
Emphasis is on reporting to internal constituencies: managers in all functional areas of the firm. An introduction to accounting principles used to prepare internal financial reports used for management decision-making. Topics include cost determination and flow, cost-volume-profit analysis, absorption and variable costing, capital budgeting, and cash flow analysis. Prerequisite: ACC 221 completed with a grade of "C" or better.
Objective 1: Demonstrate an understanding of cost terms and concepts, cost flows, and applied cost values under different manufacturing scenarios. Students will demonstrate their understanding through the following:
(1) Organize costs by classification as either manufacturing or nonmanufacturing.
(2) Identify manufacturing costs as either: direct materials, direct labor, or manufacturing overhead.
(3) Describe a variety of specific costs that would be classified as nonmanufacturing.
(4) Define the following cost terms: product, period, prime, conversion, variable, fixed, direct, indirect, differential, opportunity and sunk.
(5) Distinguish costs that are reported in the balance sheet from those that are reported in the income statement.
(6) Compute cost of goods manufactured and prepare a schedule of cost of goods manufactured.
(7) Compute product costs in a job order cost system.
(8) Apply overhead costs to jobs using a pre-determined overhead application rate.
(9) Account for overhead costs that are not applied to jobs at the end of the accounting period.
(10) Apply overhead costs to jobs using multiple pre-determined overhead application rates.
(11) Distinguish between costs applied to products in a job order cost system and costs applied to products in a process cost system.
Objective 2: Demonstrate an understanding of cost behavior as well as how the relationship between costs, revenues, and changes in sales volume affect profitability. Students will demonstrate their understanding through the following:
(1) Analyze cost behavior using a scattergraph and high/low analysis.
(2) Demonstrate the linear relationship between costs and volume changes.
(3) Prepare a contribution format income statement.
(4) Describe the functional difference between a traditional format income statement and a contribution format income statement.
(5) Compute the contribution margin ratio and demonstrate its effect on profitability with changes in sales.
(6) Calculate the degree of operating leverage and demonstrate its effect on profitability with changes in sales.
(7) Compute product costs using variable costing.
(8) Compare and contrast variable and absorption costing.
(9) Prepare a contribution income statement using variable costing and discuss its usefulness in decision making.
(10) Explain the difference between variable and absorption costing incomes.
Objective 3: Demonstrate an understanding of budgeting concepts for planning, profit, and performance analysis. Students will demonstrate their understanding through the following:
(1) Prepare the components of a master budget including: sales, production, direct materials, direct labor, overhead, selling and administrative expenses, cash flows, income statement, balance sheet, and supporting schedules of cash receipts and payments.
(2) Prepare flexible budgets to evaluate performance outcomes and distinguish between volume and cost variances.
(3) Distinguish between ideal and practical standards.
(4) Develop standards for direct materials, direct labor, and manufacturing overhead.
(5) Calculate direct materials price and quantity variances.
(6) Calculate direct labor rate and efficiency variances.
(7) Calculate variable overhead spending and efficiency variances.
(8) Explain the causes of manufacturing variances.
(9) Summarize materials, labor, and overhead variances and demonstrate their effect on profitability.
Objective 4: Demonstrate an understanding of the tools used in decision analysis including those used in segment reporting, capital budgeting, and financial statement analysis. Students will demonstrate their understanding through the following:
(1) Define a segment and identify a variety of ways that a business can be segmented.
(2) Identify costs as being traceable or common with respect to different segments.
(3) Prepare a segmented income statement.
(4) Analyze the effect on company profits of a segment being dropped.
(5) Define the different levels of a business as being cost, revenue, or profit centers.
(6) Apply the measures of return on investment and residual income to evaluate investment center performance.
(7) Identify the limitations of financial statement analysis.
(8) Analyze financial statements using a wide variety of financial statement ratios for the common stockholder, short-term creditor, and long-term creditor.
(9) Prepare common sized income statements and balance sheets, and analyze the results.
(10) Prepare a horizontal/trend analysis of financial information using comparative balance sheets and income statements, or components thereof.
(11) Apply time value of money concepts to capital budgeting decisions.
(12) Evaluate the acceptability of an investment project using the net present value method.
(13) Evaluate the acceptability of an investment project using the internal rate of return method.
(14) Compare competing projects using the total cost approach and the incremental cost approach.
(15) Calculate the payback period and simple rate of return for an investment.
Objective 5: Demonstrate an understanding of how cash flows affect the firm. Students will demonstrate their understanding through the following:
(1) Define cash and cash equivalents.
(2) Classify the various activities within the firm as operating, investing, or financing activities.
(3) Analyze changes in financial statement accounts to determine their affect on cash.
(4) Adjust changes resulting from investing activities to report at gross rather than net amounts.
(5) Prepare a complete statement of cash flows using the indirect method.
(6) Identify transactions that would be reported separately as non-cash transactions.
(7) Evaluate a company’s health relative to its cash flows.