Standard

ACC 201 – Principles of Accounting I

Course Description:

Introduces the students to the fundamental accounting principles as they apply to the completion of the accounting cycle, asset valuation, determination of income, basic business taxes and financial reporting. Topics include: accounting vocabulary, types of business entities, journalizing and posting transactions, asset valuation, accounting for business ownership including debt and equity transactions and preparing and analyzing financial statements.

Competency Areas:	Hours:
Accounting Vocabulary	Class	5
Types of Business Entitles	D. Lab	0
Journalizing and Posting Transactions	P. Lab/O.B.I.	0
Asset Valuation	Credit	5
Accounting for Business Ownership
Preparing and Analyzing Financial Statements
Prerequisite: Program admission; English and math competency
Corequisite:
Course Guide

Competency	After completing this section, the student will:	Hours
		Class	D. Lab	P. Lab/ O.B.I.
ACCOUNTING VOCABULARY		2	0	0
The accounting process	Describe the accounting process.
	Define accounting related terms.
Accounting elements	Define the accounting elements.
Account classification	Identify and classify different types of accounts.
Accounting systems	Describe and illustrate principles of properly designed accounting systems and internal control.
TYPES OF BUSINESS ENTITLES		1	0	0
Business entities	Distinguish between different types of business organizations and identify key differences between each type of organization.
	Summarize the differences in the equity sections for sole proprietorships, partnerships and corporations.
Business stakeholders	Identify individuals and entities that have an interest in the economic performance of the business.
JOURNALIZING AND POSTING TRANSACTIONS		14	0	0
The accounting equation	Classify business transactions.
	Relate how business transactions affect the accounting equation.
Recording business transactions	Prepare the balance sheet budgets for a manufacturing business.
	Record business transactions in the journal.
	Post journal entries to the ledger accounts.
	Prove the accuracy of the ledger.
ASSET VALUATION		14	0	0
Cash	Record business transactions involving cash.
	Maintain a record of cash. Prepare a bank reconciliation.
Receivables	Record losses from uncollectible accounts using the direct write-off and the allowance method.
	Record the recovery of an account previously written off.
	Describe and record transactions involving notes receivable and the calculation of interest.
Inventory	Describe the system of inventory used in accounting for a merchandising business.
	Compute the cost of inventory using the FIFO, LIFO and lower cost of market methods of inventory valuation.
	Estimate ending inventory using the gross profit and simplified retail methods.
Fixed Assets	Determine the cost of fixed assets; calculate the depreciation of fixed assets by the straight-line, declining balance and units of productions methods.
	Calculate depletion and amortization of assets.
Investments in stocks and bonds	Determine the amount of the investment in stocks and bonds, determine whether the cost or equity method is used to record the investment in stock and recognize revenue, calculate amortization or discount on investments in bonds and determine the balance sheet presentation of investments in stock and bonds.
ACCOUNTING FOR BUSINESS OWNERSHIP		12	0	0
Accounting for proprietorship and partnership investments	Describe and record transactions involving cash and non-cash investments by the owner of a proprietorship and owners of partnerships.
Accounting for stockholder investments	Describe and record transactions involving cash and non-cash investments by stockholders.
	Define capital stock, its classes, its characteristics and all associated terms.
	Recognize the issue of stock at par, at a premium and at a discount and record journal entries appropriate to each..
	Describe and record transactions involving treasury stock
	Identify and define the primary sources of paid-in capital.
	Define a stock split and calculate changes in numbers of shares and par or stated value.
	Define cash dividends and stock dividends, calculate total dividends and dividends per share for preferred and common stock.
Accounting for debt	Describe the characteristics of bonds and record transactions involving the issue, payment of interest and repayment of bonds.
	Describe the liabilities associated with a bond issue and the purpose of appropriation of retained earnings and bond sinking funds.
	Describe the potential impact of long-terms borrowing on earnings per share of a corporation.
PREPARING AND ANALYZING FINANCIAL STATEMENTS		7	0	0
Analyzing and recording adjusting entries	Analyze and identify accounts that should be adjusted and journalize adjusting entries.
Income Statement	Prepare a multiple step income statement as well as an income statement that reports income and earnings per share from continuing operations and extraordinary items net of applicable income tax.
Equity Statements	Prepare an equity statement for a proprietorship and a partnership.
	Prepare a statement of stockholders’ equity and retained earnings for a corporation.
Balance Sheet	Prepare a balance sheet.
Statement of Cash Flows	Prepare a statement of cash flows using data from operating activities, investing activities and financing activities.
Analyzing financial statements	Identify basic financial statement analytical procedures.
	Use financial statement analysis to asses the solvency and profitability of a business.
	Describe the uses and the limitations of financial statement analytical procedures.
	Describe the contents of corporate annual reports.

Suggested Resources

Book:

Warren, C.S., et al. (20^th ed.). Accounting. Cincinnati: South-Western.