School of Administrative Studies
Faculty of Liberal & Professional Studies
York University
Summer 2014 Course Outline – all sections
AP/ADMS 3585 3.0 Intermediate Accounting I
Course Director : / Bartosz Amerski / Alla VolodinaSection : / A / B
Course website: / Access to Section A / Access to Section B
Location : / TEL 0006 / TEL 0014
Instructor Office Hours: / By Appointment Only
E-Mail Address : /
Calendar Description
This course, in conjunction with AP/ADMS 3595 3.00, develops thorough knowledge and understanding of generally accepted accounting principles and financial statement analytical skills by examining various technical areas of financial accounting. Prerequisite: AP/ADMS 2500 3.00. Prior to Fall 2009 Prerequisite: AK/ADMS 2500 3.0. Course credit exclusion: AK/ADMS 3585 3.00.
Learning Outcomes
After completion of the course, apart from mastering the technical knowledge of the revenue and asset side of the financial statements, students should also
1. Understand the importance of ethics in the accounting profession and realize potential conflicts of interest that one may encounter in the profession.
2. Begin to learn how to see the inter-relationship between accounting issues, analyse them, and integrate the findings to draw reasonable conclusions.
3. Begin to learn the basics of case writing and communicate effectively.
4. Understand the importance of teamwork and learn how to develop work plans and resolve conflicts.
Textbook
Required
Intermediate Accounting, 10th Canadian Edition, Volume 1, By Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, and Bruce McConomy ISBN: 978-1-118-30084-8 ©2013
Do not use previous editions
Recommended
Accounting recommendations, CICA Handbook, Canadian Institute of Chartered Accountants, available through eResources at York University library.
Optional
1. Student Study Guide to above text.
2. Publisher’s Student Companion Website: www.wiley.com/canada/kieso
3. WileyPlus: for exercise practice - Class Section URLs:
ADMS 3585: http://edugen.wileyplus.com/edugen/class/cls370292/
Grade Components
Weighting / Due DateQuizzes / 15% / See Schedule / 5% each. Best 3 out of 4.
Group Assignment / 15% / See Schedule / See instructions below
Mid Term Exam / 30% / June 21 1-4pm / Chapter 1-6, 8
Final Exam / 40% / Exam Period / 3 Hours
(Chapter 1-12)
Total / 100%
Quizzes 15%
There are 4 short quizzes in the term. Each quiz is 15 minutes long with 10 multiple choice questions and worth 5% each. You may drop the one with the lowest mark. Each quiz will cover materials contained in the self-study videos posted on the course website. These videos provide introduction to each chapter and demonstration of the more rudimentary topics in the chapter. Quizzes are conducted IN THE BEGINNING of class, therefore, please be on time because no extra time will be given.
Group Assignment 15%
The group assignment will account for 15% of the total marks. The class will be divided into groups of 6-7 students based on the active enrolment at that time. Each group is expected to analyze an assigned annual report. Detailed guidelines will be provided in class. Peer evaluation will be conducted to ensure all members contribute equally to the assignment. Therefore, it is strongly recommended that you study together with your team members, and that each student contributes to the group assignment.
You are strongly encouraged to work on the group assignment every week to maximize learning benefits because each question is directly related to the materials covered each week.
There are two submissions: The first one on June 10th and the second one on July 29th. Please submit the hardcopy in class. NO LATE SUBMISSION WILL BE ACCEPTED, NO EXCEPTION.
Exams: 30% midterm; 40% final
There is one midterm exam and one final exam. The midterm exam lasts 3 hours and contains multiple-choice questions and comprehensive problems. The final exam lasts 3 hours and contains multiple-choice questions, comprehensive problems and a case.
Course Support
On Campus Tutorial schedule (TBA)
End of chapter problems demonstration: videos will be posted on the course website
Summary of Class Schedule
Week 1: May 6 / Chapter 1: Canadian Reporting Environment
Week 2: May 13 / Chapter 2: Conceptual Framework
Week 3: May 20 / Chapter 4 Reporting Financial Performance; Chapter 5 Financial Position and Cash Flows; QUIZ#1
Week 4: May 27 / Chapter 5: Financial Position and Cash flows; Chapter 6: Revenue Recognition
30-May / Last day to enrol without permission; ADMS 3585 follows a strict policy of no late enrolment allowed after this date
Week 5: Jun 3 / Chapter 6: Revenue Recognition
Week 6: Jun 10 / Chapter 8: Inventory; QUIZ #2
10-Jun / Rogers Annual Report Group Assignment: First Submission (Question 1-3)
Week 7: Jun 17 / Chapter 7: Cash and Receivables
21-Jun / Midterm Exam 3 hours 1-4pm
Week 8: Jun 24 / Chapter 9: Investment
1-Jul / Canada Day - No Class
4-Jul / Last day to drop without receiving a grade
Week 9: July 8 / Chapter 9: Investment; QUIZ #3
Week 10: July 15 / Chapter 10: Acquisition of Property, Plant and Equipment
Week 11: July 22 / Chapter 11: Amortization, Impairment, and Disposal
Week 12: July 29 / Chapter 12: Goodwill and other Intangible Assets; QUIZ #4
29-Jul / Rogers Annual Report Group Assignment: Second Submission (Question 4-6, bonus Question 7)
Detailed Class Schedule
Week 1: Canadian Reporting Environment
Learning objectives:
1. Understand the role of financial accounting in the capital allocation process
2. Understand the relationship between financial reporting and information asymmetry
3. Understand the relationship between legislation, accounting scandals, financial engineering, and ethics
4. Understand standard setting in Canada
5. Distinguish between rules vs. principles based GAAP.
Readings: Kieso Chapter 1; Enron Case
Self-study topics: none.
Case discussion: CA1-2, CA1-3
Review Questions:
Week 2: Conceptual Framework
Learning objectives:
1. Understand the objectives of financial reporting in relation to various stakeholders, their needs and potential conflicts/biases.
2. Understand qualitative characteristics of accounting information and elements
3. Understand what Recognition, Measurement, and Presentation mean in financial reporting
4. Learn the case approach based on the conceptual framework.
Readings: Kieso Chapter 2
Self-study topics: none
Case discussion: CA2-2
Review Questions:
Week 3: Financial Statements: Reporting Financial Performance and Financial Position
QUIZ #1 on Chapter 4 and 5 self-study materials
Learning objectives:
1. Determine what defines high earnings quality
2. Understand the purpose, usefulness, and limitations of the Statement of Financial Position
3. Prepare the Statement of Income and Comprehensive Income, the Statement of Financial Position, the Statement of Retained Earnings, and the Statement of Changes in Equity in the format required by IFRS and ASPE
4. Evaluates accounting treatment for discontinued operations and assets held for sale
5. Calculate earnings per share in accordance with IFRS and ASPE.
6. Evaluates disclosure for changes in accounting policies, contingencies, contractual situations, subsequent events
Readings: Kieso Chapter 4 and 5
Self-study topics: Income Statement presentation (Kieso p. 169-179); Statement of Financial Position presentation and classification (Kieso p. 225-238)
Case Discussion: IC4-1
Review Questions:
Rogers Annual Report Group Assignment: Question1 (a) to (j)
Week 4: Financial Position and Cash Flows; Revenue Recognition
Learning objectives:
1. Understand the purpose and usefulness of the Statement of Cash Flows
2. Prepare the Statement of Cash Flows: Indirect method
3. Calculate and interpret ratios
4. Evaluate treatment for revenue: recognition criteria, discrete vs. continuous earning process, multiple deliverables, gross vs. net revenue
Readings: Kieso Chapter 5 and 6, Appendix 5A
Self-study topics: Appendix 5A Ratio Analysis (Kieso p. 255-258); Revenue Recognition criteria (Kieso p. 323), accounting treatment for concessionary terms, payments to customers and consignment (Kieso p. 319-320, 330-331, 334)
Case Discussion: Groupon Inc., CA6-1
Review Questions:
Rogers Annual Report Group Assignment: Question 2 (a) and (b), Question 3 (a) and (b)
Week 5: Revenue Recognition
Learning objectives:
1. Accounting for long term contracts in profitable, interim loss, and overall loss situations.
Readings: Kieso Chapter 6 p. 335-344
Self-study topics: none
Case Discussion: IC 6-3
Review Questions:
Week 6: Inventory
QUIZ #2 on Chapter 6 and 8 self-study materials
Learning objectives:
1. Evaluate treatment for inventory transactions: definition and recognition, measurement, and disclosure.
2. Evaluate the impact of inventory errors on the accuracy of financial statements
3. Understand the differences and evaluate the appropriateness of the choice of cost formula.
4. Calculate and analyse inventory impairment loss: lower of cost and net realizable value
5. Understand accounting for other types of inventory excluded from the LCNRV rule (e.g. biological assets and agricultural produce at point of harvest)
6. Estimate inventory using the gross profit method
Readings: Kieso Chapter 8, no appendix
Self-study topics: Inventory definition, physical goods included in inventory, costs included in inventory, inventory accounting systems, cost formula- the mechanics, inventory turnover ratio. (Kieso p. 451-456, p. 460-473, p. 484)
Case Discussion: IC8-1
Review Questions:
Week 7: Cash and Receivables
Learning objectives:
1. Evaluate treatment for cash and receivables: definition, recognition, measurement, and disclosure
2. Determine and analyse allowance for doubtful account balance and related bad debt expense account.
3. Determine note receivables balance using the effective interest and straight line method
4. Determine amounts to be recorded when notes are received for property, goods, or services
5. Evaluate appropriate treatment for sale of receivables with or without recourse, receivables securitization, and secured borrowings under ASPE and IFRS
Readings: Kieso Chapter 7, Appendix 7A
Self-study topics: Definition of Financial Assets, Cash, and Receivables, accounting for discounts, returns, and allowances, accounts receivable turnover ratio, bank reconciliation (Kieso, p. 376-384, p.408-409, Appendix 7A)
Case Discussion: IC 7-1
Review Questions:
Rogers Annual Report Group Assignment: Question 4 (a) and (b)
Week 8: Investment Part 1 Non-Strategic Investments
Learning objectives:
1. Accurately determine and apply the appropriate measurement model (cost/amortized cost, FV-NI, FV-OCI) for non-strategic investments depending on the facts surrounding their acquisition.
2. Accurately calculate balances for the above investments using the effective interest and straight line method.
3. Accurately calculate any realized and unrealized gain or losses and the appropriate presentation.
4. Understand and interpret the implication of each measurement model as applied to the investments on decision making.
Readings: Kieso Chapter 9 no appendix
Self-study topics: none
Review Questions:
Week 9: Investment Part 2 Strategic Investments
QUIZ #3 on Chapter 7 self-study materials
Learning objectives:
1. Accurately determine investments that fall into the categories of significant influence or control
2. Apply and understand the use of equity method
3. Comprehend the basic concept of consolidation
4. Interpret the implication of the equity method on decision making
5. Accurately recognize, measure, and disclose impairment loss on non-strategic and strategic investments
6. Comprehend the three levels of fair value input
Readings: Kieso Chapter 9, Appendix 2A
Case Discussion: CA 9-1
Self-study topics: none
Review Questions:
Rogers Annual Report Group Assignment: Question 5 (a)
Week 10: Acquisition of Property, Plant and Equipment
Learning objectives:
1. Evaluate treatment for PPE: recognition criteria, measurement and disclosure
2. Understand and apply the concept of componentization
3. Understand specific cost elements: borrowing costs, dismantling and restoration costs
4. Understand and evaluate treatment for nonmonetary exchanges, contributed assets, and government assistance.
5. Accurately calculate year end balances using appropriate measurement model (cost, revaluation, fair value)
6. Evaluate appropriate treatment for costs incurred after acquisition
Readings: Kieso Chapter 10 no appendix
Self-study topics: Definition of PPE, cash discounts and deferred payment terms, lump sum purchases and costs associated with specific assets (Kieso p. 599, 604-606, p. 613-615)
Case Discussion: IC10-1
Review Questions:
Week 11: Amortization, Impairment, and Disposition
Learning objectives:
1. Evaluate different depreciation policies and accurately calculate depreciation expense
2. Understand depletion of natural resources
3. Evaluate treatment for other depreciation issues: change in estimates and policy, partial year depreciation
4. Understand and apply different impairment models.
5. Understand and apply impairment models to asset groups and cash-generating units
6. Evaluate treatment for held for sale and derecognition of PPE
Readings: Kieso Chapter 11, no appendix
Self-study topics: Depreciation Basics: Straight-line, Diminishing Balance, Units of Production (Kieso, p. 674-677)
Case: IC11-2
Review Questions:
Rogers Annual Report Group Assignment: Question 6 (a) and (b), bonus question: Question 7 (a) to (e)
Week 12: Goodwill and Other Intangible Assets
QUIZ #4 on Chapter 10, 11 and 12 self-study materials
Learning objectives:
1. Evaluate treatment for intangible assets: recognition, measurement, and disclosure
2. Evaluate treatment for research and development costs and impact on decision making
3. Understand and apply impairment models to intangibles assets
4. Evaluate treatment for goodwill: recognition, measurement, and disclosure.
5. Understand and apply impairment model to goodwill
6. Understand excess earnings approach and total-earnings approach to goodwill valuation (if time permits)
Readings: Kieso Chapter 12, Appendix 12A(if time permits)
Self-study topics: Intangibles and Goodwill definitions, Specific Intangibles (Kieso, p. 737-738, p746-751, p.753-754)
Case Discussion: IC 6-1
Review Questions:
Page 3 of 14
PART II: ADMINSTRATIVE INFORMATION
The following contains answers to typical questions from students who attend this course. You should read it before submitting your personal inquiries to . Your message will be returned if it has been addressed in the course syllabus.
ENROLMENT
Prerequisites
Students are personally responsible for ensuring that they have the necessary prerequisites. The School of Administrative Studies reserves the right to de-enrol any student when it is determined that a student has requested a course without having the necessary listed prerequisites. The School will not be responsible for refunds resulting from students being dropped from a course due to a lack of a prerequisite. Students with outstanding deferred exams in the prerequisite course may not enrol in this course.
Enrolment Deadline
If the course is full, a waiting list will be maintained with the Receptionist at 282 Atkinson. As vacancies occur, students are contacted in order on the list. The Course Director is not involved in the registration process in any way and cannot assist you with this process. Because of the high volume of material covered, no registration under any circumstances is permitted after the “last date to enrol without permission date”. For Summer 2014, this date is May 30, 2014.