Self-Study
18
Overview
Accounting
There are no prerequisites.

Course Description

Managers are constantly confronted with situations in which they need to make decisions based on information originating in the accounting department. In Accounting for Managers, we explore the accounting information available to managers, and how the information can be employed to improve operational and financial results. Topics covered include the creation and use of financial statements, responsibility centers, relevant accounting standards, decision making issues in specific functional areas, and a variety of analysis tools.



Instructor

Steven M. Bragg, CPA

Steven M. Bragg, CPA, is a full-time book and course author who has written more than 70 business books. He provides Western CPE with self-study courses in the areas of accounting and finance, with an emphasis on the practical application of accounting standards and management techniques. A sampling of his courses include the The New Controller Guidebook, The GAAP Guidebook, Accountants’ Guidebook, and Closing the Books: An Accountant’s Guide. He also manages the Accounting Best Practices podcast.

Steven has been the CFO or controller of both public and private companies and has been a consulting manager with Ernst & Young and an auditor with Deloitte & Touche. He holds an MBA from Babson College, a Master of Finance from Bentley College, and a BA from the University of Maine (summa cum laude).



Course Specifics

Accounting
Mar 31, 2017
There are no prerequisites.
SS1163388
341
None


Compliance Information

103220
Qualifies for CA Fraud: No


Learning Objectives

Upon successful completion of this course, participants will be able to:

Chapter 1

  • Cite the types of accounting transactions and where they are recorded, as well as the roles of the controller and chief financial officer.

Chapter 2

  • Note the different accounting principles and sub-ledger types, as well as the structure of the general ledger, and the reasons for the accounting cycle.

Chapter 3

  • Identify the types of financial statements and their reporting formats, as well as their users.

Chapter 4

  • State the types of ratio analysis used to interpret the financial statements, the uses of each one, and their contents.

Chapter 5

  • Note the uses to which different account code structures can be put, and the different types of responsibility centers.

Chapter 6

  • Cite the proper accounting for loss contingencies, compensated absences, research and development, acquired software, and stock-based compensation.

Chapter 7

  • Note how the contribution margin, breakeven levels, and margin of safety can be calculated and how they are used, as well as the determinants of demand.

Chapter 8

  • Identify the types of payroll systems, the uses of the different pay codes, the types of deposit schedules, the criteria for designating a person as an employee, and the penalties associated with payroll tax underpayment.

Chapter 9

  • State the nature of the analysis methods used to examine possible investments, as well as the advantages of each one.

Chapter 10

  • Note the features of the various acquisition structures and the benefits to be gained from each one, as well as the nature of appraisal rights.

Chapter 11

  • Identify the limitations of direct cost analysis and the components of an activity-based costing analysis.

Chapter 12

  • Itemize the activities that can be pursued to achieve a target cost when designing a new product, as well as the sources of the required cost analysis information.

Chapter 13

  • State the main features of a system of constraint analysis, and how this system can be used to improve profits.

Chapter 14

  • Note the methods used to derive estimates for a budget, the impact of operational changes on a budget, and how information rolls up through the various subsidiary-level budgets. Also note the calculation methods used to derive production and labor budgets.

Chapter 15

  • Identify the types of variances, the factors that can trigger different types of variances from the expected amounts, and also note the reports used to reveal variance information.



Table of Contents

Chapter 1 – The Need for Accounting Information

Learning Objectives

Introduction

The Accountancy Concept

Financial and Managerial Accounting

Decisions Requiring Accounting Information

The Structure of this Book

Summary

Chapter 1 – Review Questions

Chapter 2 – Introduction to Accounting

Learning Objectives

Introduction

Accounting Frameworks

Accounting Principles

The Accounting Cycle

Accounting Transactions

Source Documents

Double Entry Accounting

The Ledger Concept

The General Ledger

Accounts Receivable Ledger

Purchase Ledger

Journal Entries

Major Journal Entries

The Accruals Concept

The Realization Concept

The Trial Balance

Accrual Basis of Accounting

Cash Basis of Accounting

Summary

Chapter 2 – Review Questions

Chapter 3 – The Financial Statements

Learning Objectives

Introduction

The Income Statement

Income Statement Overview

The Single-Step Income Statement

The Multi-Step Income Statement

The Condensed Income Statement

The Contribution Margin Income Statement

The Multi-Period Income Statement

The Balance Sheet

Overview of the Balance Sheet

The Common Size Balance Sheet

The Comparative Balance Sheet

The Statement of Cash Flows

Overview of the Statement of Cash Flows

The Direct Method

The Indirect Method

The Statement of Retained Earnings

Overview of the Statement of Retained Earnings

Financial Statement Footnotes

Consolidated Financial Statements

Interim Financial Statements

Pro Forma Financial Statements

Financial Statement Audits, Reviews, and Compilations

Summary

Chapter 3 – Review Questions

Chapter 4 – Interpreting Financial Statements

Learning Objectives

Introduction

Interpretation of Financial Statements

Horizontal Analysis

Vertical Analysis

Cash Coverage Ratio

Current Ratio

Quick Ratio

Liquidity Index

Accounts Payable Turnover Ratio

Accounts Receivable Turnover Ratio

Inventory Turnover Ratio

Fixed Asset Turnover Ratio

Sales to Working Capital Ratio

Debt to Equity Ratio

Fixed Charge Coverage

Breakeven Point

Gross Profit Ratio

Net Profit Ratio

Return on Net Assets

Return on Equity

Limitations of Ratio Analysis

Effect of the Number of Days in a Month

Summary

Chapter 4 – Review Questions

Chapter 5 – Evaluation of Responsibility Centers

Learning Objectives

Introduction

Responsibility Reporting

Functional Organizational Structure

Divisional Organizational Structure

The Structure of the Chart of Accounts

Three-Digit Chart of Accounts

Five-Digit Chart of Accounts

Seven-Digit Chart of Accounts

Responsibility Center Information Reporting

Transfer Pricing

Market Price Basis

Adjusted Market Price Basis

Negotiated Basis

Contribution Margin Basis

Cost Plus Basis

Cost Anomalies in a Cost-Based Transfer Price

Pricing Problems Caused by Transfer Pricing

Tax Impact of Transfer Prices

Accounting Issues Related to Responsibility Centers

Summary

Chapter 5 – Review Questions

Chapter 6 – Overview of Selected Accounting Standards

Learning Objectives

Introduction

Accounting Changes and Error Corrections

Advertising

Capitalized Interest

Compensated Absences

Contingencies

Deferred Compensation

Fixed Assets

Inventory

First In, First Out Method

Last In, First Out Method

Weighted Average Method

Specific Identification Method

Research and Development

Subsequent Events

Stock-Based Compensation

Taxes

Summary

Chapter 6 – Review Questions

Chapter 7 – Sales and Marketing Decisions

Learning Objectives

Introduction

Contribution Margin

Breakeven Point

Margin of Safety

Cost-Volume-Profit Analysis

Sales Mix

Accounting Inputs to Price Formulation

Cost Plus Pricing

Time and Materials Pricing

Breakeven Pricing

Price Elasticity of Demand

Cross Price Elasticity of Demand

Non-Price Determinants of Demand

Summary

Chapter 7 – Review Questions

Chapter 8 – Human Resources Decisions

Learning Objectives

Introduction

Payroll Cycles

Time Tracking Issues

Time Tracking Scope

Employee Exclusions

Data Collection Scope

Payroll Deduction Issues

Payroll Tax Remittance Issues

Definition of an Employee

Accrued Bonuses

The Common Paymaster Rule

Unemployment Insurance Issues

The Employee Cost Object

The True Variability of Direct Labor

Compensation Cost Reduction

Proactive Hiring Solutions

Temporary Cost Reductions

Permanent Cost Reductions

Summary

Chapter 8 – Review Questions

Chapter 9 – Investment Decisions

Learning Objectives

Introduction

The Investment Decision

Payback Analysis

Discounted Payback

Accounting Rate of Return

Time Value of Money

Present and Future Value Tables

Net Present Value

Internal Rate of Return

Incremental Internal Rate of Return

Terminal Value

Real Options

Complex Systems Analysis

Research and Development Funding Analysis

Accounting Issues Related to Investment Decisions

Impairment of Fixed Assets

Impairment of Securities

Impairment of Investments in Other Entities

Summary

Chapter 9 – Review Questions

Chapter 10 – Acquisition Decisions

Learning Objectives

Introduction

Accounting Due Diligence

Impact on Earnings per Share

Tax Issues in an Acquisition

Tax Issues for the Seller

Tax Issues for the Acquirer

Issues with Stock Purchases

General IRS Requirements to Avoid Gain Recognition

The Type “A” Acquisition

The Type “B” Acquisition

The Type “C” Acquisition

The Type “D” Acquisition

Triangular Mergers

The Triangular Merger

The Reverse Triangular Merger

The Asset Acquisition

Impact of the Acquiree Organizational Form

Summary of Legal Structures

Accounting Integration

Summary

Chapter 10 – Review Questions

Chapter 11 – Cost Accounting Tools and Concepts

Learning Objectives

Introduction

Direct Costing

Direct Costing as a Managerial Tool

Automation Investments

Cost Reporting

Customer Profitability

Profit-Volume Relationship

Outsourcing

Direct Costing Pitfalls

The Problem with Overhead Allocation

Activity-Based Costing

Activity-Based Management

Summary

Chapter 11 – Review Questions

Chapter 12 – Target Costing

Learning Objectives

Introduction

The Basic Steps of Target Costing

Value Engineering Considerations

The Cost Reduction Program

The Milestone Review Process

Problems with Target Costing

The Members of a Design Team

The Role of Accounting in Target Costing

Data Sources for Target Costing

The Product Life Cycle and Target Costing

Summary

Chapter 12 – Review Questions

Chapter 13 – Constraint Analysis

Learning Objectives

Introduction

Constraint Analysis Operational Terminology

Overview of Constraint Analysis

The Cost of the Bottleneck

Local Optimization

Constraint Analysis Financial Terminology

Constraint Analysis from a Financial Perspective

The Constraint Analysis Model

The Decision to Sell at a Lower Price

The Decision to Outsource Production

The Capital Investment Decision

The Decision to Cancel a Product

Summary

Chapter 13 – Review Questions

Chapter 14 – Budgeting Concepts

Learning Objectives

Introduction

The System of Budgets

The Reasons for Budget Iterations

Overview of the Revenue Budget

The Ending Finished Goods Inventory Budget

The Production Budget

Production Budgeting for Multiple Products

The Direct Materials Budget (Roll up Method)

The Direct Materials Budget (Historical Method)

The Direct Labor Budget

The Manufacturing Overhead Budget

The Sales and Marketing Budget

Diminishing Returns Analysis

The Research and Development Budget

The Administration Budget

The Compensation Budget

The Budgeted Income Statement

The Budgeted Balance Sheet

Accounts Receivable

Inventory

Fixed Assets

Accounts Payable

Additional Estimation Elements

The Cash Line Item

The Financing Budget

The Compiled Balance Sheet

Summary

Chapter 14 – Review Questions

Chapter 15 – Budgetary Control

Learning Objectives

Introduction

General Reporting Format

Revenue Reporting

Selling Price Variance

Sales Volume Variance

Overview of Cost of Goods Sold Variance Reporting

The Purchase Price Variance

Material Yield Variance

Labor Rate Variance

Labor Efficiency Variance

Variable Overhead Spending Variance

Variable Overhead Efficiency Variance

Fixed Overhead Spending Variance

Problems with Variance Analysis

Which Variances to Report

Summary

Chapter 15 – Review Questions

Review Question Answers and Rationales

Glossary

Index

Final Examination

Answer Sheet

Course Evaluation

 

 



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