Course Outline: Module 10
Stockholders’ Equity
ACC 201 Financial Accounting
The primary goal of this module is: Introduce students to stockholders’ equity, including capital stock,
retained earnings, other comprehensive income, and treasury stock.
Module 10 – Stockholders’ Equity
Introduction
After learning about assets and liabilities, in this module, we will learn about the last portion of the
accounting equation – stockholders’ equity.
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Learning Objectives
After completing this module, students will be able to:
1. Distinguish between common and preferred stock and describe their use in raising capital.
2. Record capital stock.
3. Account for the distribution of assets to stockholders.
4. Describe the accounting issues related to retained earnings and accumulated other
comprehensive income.
5. Analyze stockholder payout and profitability ratios using information contained in the
stockholders’ equity section.
Due This Week
Assignment
Format
Grading
Interactive Lecture and Quiz
PowerPoint presentation
5 points
Lesson 1 Homework
CengageNow
5 points
Interactive Lecture and Quiz
PowerPoint presentation
5 points
Lesson 2 Homework
CengageNow
5 points
Lesson 1 – Issuing Stock
Lesson 2 – Distributions to Stockholders
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Lesson 3 – Retained Earnings, Other
Accumulated Comprehensive Income, and
Equity Analysis
Interactive Lecture and Quiz
PowerPoint presentation
5 points
Lesson 3 Homework
CengageNow
5 points
*Use this table to fill out the course calendar. Be sure to add dates in the course calendar.
Learning Activities
The learning activities section is a way for you to sequence your students learning. Consider this as
your way of guiding them to understanding and scaffolding their learning. Be creative, use the right
tool for the right objectives and whenever possible integrate knowledge checks with feedback and/or
reflection. Be sure to provide an overview of each activity in the sequence and how it will help the
learner achieve the learning objectives. Add learning activities as necessary.
Lesson 1 – Issuing Stock
This lesson introduces the differences between common and preferred stock the issuing this stock.
Reading
Read pages 474 - 480 in your textbook, Cornerstones of Financial Accounting.
This reading will introduce stock, the difference between common and preferred stock and how to issue
shares of stock to stockholders.
Interactive Lecture
Issuing Stock
In this narrated PowerPoint lecture you will learn how record the journal entries to issue common and
preferred stock whether it is sold at par or stated value or for a greater amount.
Activity
Assignment Name
CengageNow Homework
Graded Assignment
YES
<insert CengageNow link here>
Points Possible
5 pts
www.cengagebrain.com
Lesson 1 Homework Problems from CengageNow
After completing the reading and the interactive lecture, proceed to CengageNow to complete Module 10,
Lesson 1, “Issuing Stock”.
Grading and Feedback
You can expect this assignment to be graded in CengageNow immediately after your submission.
©2012 Gateway Community College
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Lesson 2 – Distributions to Stockholders
Recognizing interest expense, especially when bonds are issued at either a premium or discount, can be
challenging. This lesson teaches two methods for accounting for these discounts and premiums, the
straight-line method and the effective interest rate method.
Reading
Read pages 481 - 490 in your textbook, Cornerstones of Financial Accounting.
This reading will show you the different ways that corporations can distribute cash or other benefits to
stockholders. These distributions include the purchase of shares from stockholders, issuing dividends,
and stock splits.
Interactive Lecture
Distributions to Stockholders
In this narrated PowerPoint lecture you will learn how to record the purchase and resale of treasury stock,
the issuance of both cash and stock dividends and stock splits.
Activity
Assignment Name
CengageNow Homework
Graded Assignment
YES
<insert CengageNow link here>
Points Possible
5 pts
www.cengagebrain.com
Lesson 2 Homework Problems from CengageNow
After completing the reading and interactive lecture, proceed to CengageNow to complete Module 10,
Lesson 2, “Distributions to Stockholders”.
Grading and Feedback
You can expect this assignment to be graded immediately in CengageNow after your submission.
Lesson 3 – Retained Earnings, Other Accumulated Comprehensive Income, and Equity Analysis
This lesson introduces retained earnings, a part of stockholders’ equity, other accumulated
comprehensive income and numerous ratios to analyze stockholders’ equity.
Reading
Read pages 491 – 497 in your textbook, Cornerstones of Financial Accounting.
This reading will teach about the remaining portion of the stockholders’ equity section of the balance
sheet – retained earnings and other accumulated comprehensive income. As the in other modules, the
lesson will end with a number of ratios that aid in evaluating a corporation relative to stockholders’ equity.
Interactive Lecture
Retained Earnings, Other Accumulated Comprehensive Income and Equity Analysis
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In this narrated PowerPoint lecture you will learn how to calculate retained earnings, the basics of
reporting other accumulated comprehensive income, and finally, the calculation of ratios to evaluate
retained earnings.
.
Activity
Assignment Name
CengageNow Homework
Graded Assignment
YES
<insert CengageNow link here>
Points Possible
5 pts
www.cengagebrain.com
Lesson 3 Homework Problems from CengageNow
After completing the reading and interactive lecture, proceed to CengageNow to complete Module 10,
Lesson 3, “Retained Earnings, Other Accumulated Comprehensive Income, and Equity Analysis”.
Grading and Feedback
You can expect this assignment to be graded immediately in CengageNow after your submission.
Next Step – Module 11
©2012 Gateway Community College
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