Adopted:____________
Reviewed:___________
Revised:
2002
BUS 241 – Principles of Accounting I
Credit Hours – 3
Prerequisite:
Contact Hours – 3
None
I.
COURSE DESCRIPTION:
This course is designed to provide a basic theory of accounting principles and
practices used by service and merchandising enterprises. Emphasis is placed on
financial accounting, including the accounting cycle, nd financial statement
preparation and analysis.
II.
GENERAL COURSE COMPETENCIES:
The student will:
A.
gain an understanding of
B.
gain an understanding of
C.
gain an understanding of
enterprise.
D.
gain an understanding of
E.
gain an understanding of
F.
gain an understanding of
G.
gain an understanding of
H.
gain an understanding of
I.
gain an understanding of
J.
gain an understanding of
K.
gain an understanding of
III.
accounting principles and practices.
the accounting cycle for a service enterprise.
the completion of the account cycle for a service
accounting for a merchandising enterprise.
periodic reporting for a merchandising enterprise.
accruals.
the inventory valuation.
accounting system design.
cash controls in accounting.
receivables and temporary investments.
fixed assets and intangible assets.
COURSE OBJECTIVES STATED IN PERFORMANCE TERMS:
The student will:
A.
gain an understanding of accounting principles and practices. The student
will:
1.
describe accounting as an information system.
2.
describe the users of accounting information.
3.
describe the profession of accounting and its specialized fields.
4.
explain what is meant by the business entity concept and the cost
principle.
5.
describe a business transaction.
6.
identify the accounting equation and its basic elements.
7.
describe and illustrate how all business transactions can be stated in
terms of resulting changes in the three basic elements of the
accounting equation.
8.
identify and describe the financial statements of a proprietorship and
a corporation.
B.
gain an understanding of the accounting cycle for service enterprise. The
student will:
1.
describe the nature of an account and the way in which transactions can
be presented in an account.
2.
describe what is meant by the double-entry method of recording
transactions.
3.
discuss the general rules of debit and credit and normal balances for
asset, liability, owner equity, revenue, expense, drawing and dividend
accounts.
4.
describe the common classification of accounts for a small service
enterprise.
5.
describe a chart of accounts for a small service enterprise.
6.
describe and illustrate the flow of accounting data through an
accounting system.
7.
describe and illustrate the use of a two-column account, and a fourcolumn account.
8.
describe and illustrate the posting of a transaction to the ledger.
9.
describe and illustrate the preparation of a trial balance and its use
in the discovery of errors.
BUS 241 – Principles of Accounting I
Page 2
C.
D.
E.
F.
G.
gain an understanding of the completion of the accounting cycle for a service
enterprise. The student will:
1.
discuss the matching principle as it relates to the cash basis and the
accrual basis of accounting.
2.
describe the nature of the adjusting process.
3.
describe and illustrate the basic procedures and adjusting the
accounting records prior to the preparation of financial statements.
4.
describe and illustrate the worksheet for summarizing the accounting
data for use in preparing the financial statements.
5.
describe and illustrate the preparation of financial statements for
current period.
6.
describe and illustrate the basic procedures for preparing the
accounting records for use in accumulating data for the following
accounting period.
7.
describe what is meant by a fiscal year and a natural business year.
8.
describe and diagram the basic phases of the accounting cycle.
gain an understanding of accounting for a merchandising enterprise. The
student will:
1.
describe and illustrate the accounting for purchases by a merchandising
enterprise.
2.
describe and illustrate the accounting for sales by a merchandising
enterprise.
3.
describe the sequence of year-end procedures for a merchandising
enterprise.
4.
describe the two merchandise inventory systems.
5.
describe and illustrate the Cost of Merchandise Sold section of an
income statement.
6.
describe and illustrate the journal entries for merchandise inventory
adjustments at year-end.
gain an understanding of periodic reporting for merchandise enterprise. The
student will:
1.
describe alternative formats and terminology for the income statement,
retained earnings statement, and balance sheet for a merchandising
enterprise.
2.
illustrate the preparation of an income statement, retained earnings
statement, and balance sheet from the worksheet of a merchandising
enterprise.
3.
describe and illustrate the preparation of adjusting entries and
closing entries for a merchandising enterprise.
4.
describe and illustrate the preparation of reversing entries for a
merchandising enterprise.
5.
describe the preparation of interim financial statements.
6.
describe and illustrate the procedures for correcting errors in
accounting records.
gain an understanding of accruals. The student will:
1.
identify and describe common classifications of accruals.
2.
describe and illustrate accounting for prepaid expenses.
3.
describe and illustrate accounting for unearned revenue.
4.
describe and illustrate the accounting for accrued liabilities (accrued
expenses).
5.
describe and illustrate the accounting for accrued assets (accrued
revenues).
gain an understanding of inventory valuation. The student will:
1.
describe and illustrate the effect of inventory on the financial
statements of the current period and the following period.
2.
identify and describe the two principal inventory systems.
3.
identify and illustrate the procedures for determining the actual
quantity in inventory.
BUS 241 – Principles of Accounting I
Page 3
4.
H.
I.
J.
K.
IV.
describe and illustrate the most common methods of determining the cost
of inventory, including the comparison of the effect of the methods on
operating results.
5.
describe and illustrate the valuation of inventory at the lower-of-cost
or market.
6.
describe and illustrate the perpetual inventory system.
7.
identify and illustrate the proper presentation of inventory in the
financial statement.
8.
describe and illustrate methods of estimating the cost of inventory.
gain an understanding of accounting system design. The student will:
1.
describe the principles of properly designed accounting systems.
2.
describe the three phases of accounting system installation and
revision.
3.
describe and illustrate the principles of internal control.
4.
describe the data processing methods that may be used in accounting
systems.
5.
describe and illustrate the use of ledgers in accounting systems.
6.
describe the use of electronic data processing to process accounting
data.
gain an understanding of receivables and temporary investments. The student
will:
1.
describe and illustrate the use of the bank account for controlling
cash, including the preparation of a bank reconciliation.
2.
describe internal controls for cash receipts, including the handling of
mail receipts, the use of a cash short and over account, and the use of
charge funds.
3.
describe and illustrate the use of the voucher system for controlling
cash payments.
4.
describe and illustrate the use of a discount lost account and a petty
cash account for controlling cash payments.
5.
describe the recent trends in the use of electronic funds transfer to
process cash transactions.
gain an understanding of receivables and temporary investments.
1.
describe the common classification of receivables.
2.
describe the basic principles of internal control over receivables.
3.
describe and illustrate the accounting for notes receivable, including
the determination of interest and proceeds from discount notes.
4.
describe and illustrate the allowance method accounting for
uncollectible receivables, including the estimation of uncollectibles
based on sales and an analysis of receivables.
5.
describe and illustrate the direct write-off method of accounting for
uncollectible receivables.
6.
describe and illustrate the accounting of temporary investments.
7.
describe and illustrate the presentation of temporary investments and
receivables in the balance sheet.
gain an understanding of fixed assets and depreciation concepts and methods.
The student will:
1.
be able to calculate and record depreciation on fixed assets.
2.
be able to prepare the proper balance sheet presentation of fixed
assets.
CLASS ACTIVITIES:
A.
The instructor will:
1.
explain topics from the material assigned.
2.
demonstrate acceptable solutions to representative problems from the
material assigned.
3.
explain alternative that may be applied in various situations.
B.
The student will:
1.
read assigned material from the text.
BUS 241 – Principles of Accounting I
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2.
3.
4.
V.
participate in discussion of the materials assigned.
work assigned problems (minimum of two per chapter).
provide written and oral answers to assigned material from the text.
CRITERIA FOR EVALUATION:
Given a series of assignments and examinations, the student will perform with a
minimum of 60 percent accuracy.
VI.
TEXT:
Accounting.
edition.
Warren, Reeve, Fess, South-Western College Publishing, current