Course Text
Wild, John J., Kermit D. Larson, and Barbara Chiapetta. Fundamental Accounting Principles, Volume 1, 18th edition. McGraw-Hill/Irwin, 2007. ISBN 0-07-328661-3
Course Description
This course focuses on ways in which accounting principles are used in business operations. Students learn to identify and use Generally Accepted Accounting Principles (GAAP), ledgers and journals throughout the steps of the accounting cycle. This course introduces bank reconciliation methods, balance sheets, assets, and liabilities. Students also learn about financial statements including assets, liabilities, and equity. Business ethics are also discussed.
Course Objectives
After completing this course, students will be able to:
• Identify and apply Generally Accepted Accounting Principles (GAAP). • Apply the steps of the accounting cycle. • Post and analyze transactions using ledgers and journals. • Record adjusting entries for prepaid expenses and unearned revenue. • Complete an adjusted trial balance. • Perform a bank reconciliation. • Explain the purpose of the sales journal and the Accounts Receivable ledger and post entries to both. • Record the costs associated with the acquisition of property, plant, and equipment. • Explain the purpose of and prepare entries for the purchase order journal and accounts payable (A/P) ledger. • Identify the fundamental principles of an accounting information system.
Course Prerequisites
There are no prerequisites to take Accounting I.
Course Evaluation Criteria
StraighterLine does not apply letter grades. Students earn a score as a percentage of 100%. A passing percentage is 70% or higher.
If you have chosen a Partner College to award credit for this course, your final grade will be based upon that college's grading scale. Only passing scores will be considered by Partner Colleges for an award of credit.
SMARTHINKING, Inc. © 2009 For more information visit: www.StraighterLine.com | Phone: 1-877-Str8erLine (1-877-787-8375) press option 1 | Email: [email protected] There are a total of 859 points in the course:
Topic Assessment Points Available
3 Graded Quiz A 26 4 Graded Quiz B 25 5 Graded Quiz C 26 5 Graded Exam #1 150 6 Graded Quiz D 26 7 Graded Quiz E 26 7 Graded Exam #2 150 8 Graded Quiz F 25 9 Graded Quiz G 25 10 Graded Quiz H 26 10 Graded Exam #3 150 13 Graded Quiz I 28 14 Graded Quiz J 26 14 Exam #4 150
Course Topics and Objectives
Topic Lesson Topic Subtopics Objectives 1 Accounting for • The Purpose and Use of • Describe the users of accounting Business Today Financial Information information, their informational needs, • Generally Accepted and the people responsible for Accounting Principles providing this information. (GAAP) • Explain why ethics and personal • Business Ethics integrity are important issues in the • Careers in Accounting practice of accounting. • Review the importance of GAAP in relation to various standard bodies, including the SEC, FASB, and IASB. 2 Recording • The Accounting Cycle • List the steps in the accounting cycle. Business • Transactions • Describe the various source documents Information • Journalizing the required for processing an accounting Transactions transaction. • Posting to the Ledger • Explain the processes of journalizing • The End of the and posting. Accounting Period • Outline the process of balancing and its • The Unadjusted Trial importance. Balance • List the different stages of a trial • Adjusting Entries balance. • The Adjusted Trial • Outline the process of entering Balance adjustment entries to journals. • Financial Statements • Identify different financial statements • Closing Journal Entries that can be completed at the end of an • Post-Closing Trial accounting cycle. Balance • Describe the process of closing • Overview of the accounts and explain why it is Accounting Cycle important. 3 Financial • Fundamental Accounting • Define assets, liabilities, and equity. Statements Equation • State the fundamental accounting • Income Statements equation. • Statement of Owner’s • Explain the elements of an income Equity statement, and explain its purposes • Balance Sheet and uses. • Financial Statements • Define the elements of a statement of owner’s equity (SOE,) and explain its purposes and uses. • List and explain the elements of a balance sheet, and explain their SMARTHINKING, Inc. © 2009 For more information visit: www.StraighterLine.com | Phone: 1-877-Str8erLine (1-877-787-8375) press option 1 | Email: [email protected] purposes and uses. 4 Journalizing and • Double-entry Accounting • Define the terms debit and credit. Posting Debits and Credits • Understand the role of double-entry Transactions • Using T-accounts bookkeeping in journalizing and • Entering and Analyzing posting transactions. Transactions • Record and analyze transactions using • Preparing a Trial Balance T-accounts while maintaining the integrity of the accounting equation. • Post and analyze transactions using ledgers and journals. • Explain the importance and purpose of a trial balance. 5 Preparing • Accrual Versus Cash • Compare and contrast accrual and cash Adjusting Entries Basis of Reporting basis reporting methods in relation to • Recognition and the accounting period principle. Matching Principles • Explain the importance of revenue • Journalizing and Posting recognition and the matching principle. Adjusting Entries • Identify various types of adjusting • Prepaid Expenses and entries for accruals, and describe how Unearned Revenue accounts are adjusted. • Record adjusting entries for prepaid expenses and unearned revenue. 6 The Accounting • Preparing the Adjusted • Understand and complete an adjusted Cycle Trial Balance trial balance. • Calculating Net Income • Prepare financial statements from an or Loss adjusted trial balance. • Journalizing and Posting • Explain the closing process including Closing Entries the use of temporary and permanent • Preparing the Post- accounts and record closing entries. closing Trial Balance • Create a post-closing trial balance. • The Accounting Cycle • Name the steps in the accounting and Classification cycle. Structure • Describe the classification structure and categories. • Prepare a classified balance sheet. 7 Assets: Cash and • Cash Transactions • Identify the various types of cash Controls • Establishing Internal transactions including receipts and Controls disbursements. • Cash Receipts and • Explain the purpose and use of a petty Disbursements cash fund. • Reconciling the Bank • Describe the purposes, principles, and Statement limitations of limitations of internal controls. • Identify the major guidelines and internal measures for controlling cash receipts and disbursements. • Perform a bank reconciliation. 8 Assets: Sales and • Sales Journal and • Explain the purpose of the sales Receivables Accounts Receivable journal and the Accounts Receivable Ledger ledger and post entries to both. • Recognizing Accounts • Describe how accounts receivable are Receivable recognized and valued. • Sales Returns and • Record transactions for different types Allowances of credit sales. • Accounting for Bad Debts • Record transactions for sales allowances and returns. • Describe how to estimate bad debt expense. • Post adjusting entries using the percent of sales, percent of A/R, and aging of A/R methods. 9 Assets: Inventory • Accounting for • Describe the physical elements, Valuation Inventory: Physical controls, and costs that make up
SMARTHINKING, Inc. © 2009 For more information visit: www.StraighterLine.com | Phone: 1-877-Str8erLine (1-877-787-8375) press option 1 | Email: [email protected] Count, Costs, and inventory valuation. Controls • Explain inventory closing. • Inventory Closing • Calculate the cost of inventory using Methods the specific identification, first-in first- • Valuing Inventory and out, last in-first out, or weighted Lower of Cost or Market average method. (LCM) • Determine the value of inventory using the Lower of Cost or Market method. 10 Acquisition of • Acquisition of Property, • Record the costs associated with the Property, Plant, Plant, and Equipment acquisition of property, plant, and and Equipment • Depreciation of Property, equipment. Plant, and Equipment • Account for subsequent improvements • Disposition of Property, of property, plant, and equipment. Plant, and Equipment • Define the term depreciation, and • Accounting for Natural utilize particular methods to record Resources depreciation expense. • Accounting for Intangible • Record the appropriate entries for the Assets disposal of plant, property, and equipment for a realized gain or loss. • Explain the procedures for acquiring and accounting for natural resources. • Identify the procedures for acquiring and accounting for intangible assets. 11 Liabilities: • Purchasing and the A/P • Explain the purpose of and prepare Purchasing and Ledger entries for the purchase order journal Payables • Recording Account and the accounts payable (A/P) ledger. Payables • Describe how accounts payable are • Purchase Returns and recognized and valued, and then Allowances record transactions for different types of payables. • Analyze and record transactions for returns and allowances. 12 Liabilities: Notes • Classifying Current • Describe common types of liabilities, Payable and Other Liabilities methods for estimating their values, Current Liabilities • Notes Payable and their implications for accounting • Taxes Payable purposes. • Accounting for • Define short-term notes payable and Contingent Liabilities demonstrate the ability to record journal entries for these transactions. • Discuss how deferred taxes are accounted for and the journal entries that are required to account for these items. • Explain how to account for contingent liabilities and the journal entries needed to record these liabilities. 13 Liabilities: • Employee versus • Determine if a person is an Employee and Contractor independent contractor or an employee Payroll Accounting • Recording Wages using various criteria. Payable • Compute wages payable for full-time, • Accounting for Employee part-time, salaried, hourly, Benefits: Health, commission, and piece-rate Pension, and Vacation employees. • Legal Responsibilities: • Demonstrate the ability to calculate Federal Withholdings and payroll tax deductions and liabilities Reporting including vacation, health, and pension-related transactions. • Describe the responsibilities for withholding and submitting payroll taxes to the federal government.
SMARTHINKING, Inc. © 2009 For more information visit: www.StraighterLine.com | Phone: 1-877-Str8erLine (1-877-787-8375) press option 1 | Email: [email protected] 14 Accounting • Foundation Principles for • Identify the fundamental principles of Information Accounting Information an accounting information system. Systems Systems • Describe the components of an • Elements of an accounting information system. Accounting Information • Explain the need for special journals System and how to post to and from these • Use of Special Journals journals. in an Accounting • Explain the use of subsidiary ledgers in Information System an accounting system. • Use of the Sales Journal • Explain the impact of technology on in an Accounting small, mid-size, and large companies’ Information System accounting systems. • Use of a Cash Receipts Journal in an Accounting Information System • Use of a Purchases Journal in an Accounting Information System • Use of a Cash Disbursements Journal in an Accounting Information System • Technology Solutions for Small, Mid-Sized, and Large Companies 15 Review • Course Review • None
SMARTHINKING, Inc. © 2009 For more information visit: www.StraighterLine.com | Phone: 1-877-Str8erLine (1-877-787-8375) press option 1 | Email: [email protected]