I. General Information

1. Course Title:
Accounting Principles II (Managerial)

2. Course Prefix & Number:
ACCT 2012

3. Course Credits and Contact Hours:

Credits: 4

Lecture Hours: 3

Lab Hours: 2

4. Course Description:

This course continues the study of generally accepted accounting principles used to identify, measure, and communicate useful economic information to users. Specific topics include the statement of cash flows and financial statement analysis. In addition, a major portion of this course focuses on the informational needs of management for strategic decision-making. Topics include cost-volume-profit analysis, product costing, cost management, cost behavior, relevant information, performance measurement, and capital budgeting. Ethics are incorporated into projects and discussions throughout the course.

5. Placement Tests Required:

6. Prerequisite Courses:

8. Prerequisite (Entry) Skills:
Perform the accounting cycle and prepare financial statements in good form.

9. Co-requisite Courses:

There are no corequisites for this course.

II. Transfer and Articulation

1. Course Equivalency - similar course from other regional institutions:

St. Cloud State University, ACCT 292 Accounting II, 3 credits
Bemidji State University, ACCT 1101 Principles of Accounting II, 3 credits
North Dakota State University, ACCT 201 Elements of Accounting II, 3 credits
Century College, ACCT 2025 Managerial Accounting, 3 credits
MN State University Moorhead, ACCT 231 Principles of Accounting II, 3 credits
Normandale Community College, ACCT 2252 Principles of Accounting II, 4 credits
Southwest MN State University, ACCT 212 Principles of Accounting II, 3 credits

2. Transfer - regional institutions with which this course has a written articulation agreement:

College of St. Scholastica, Accounting

III. Course Purpose

1. Program-Applicable Courses – This course fulfills a requirement for the following program(s):

Accounting, Diploma
Accountant, AAS Degree
Bookkeeping, Certificate

IV. Learning Outcomes

1. College-Wide Outcomes

College-Wide Outcomes/Competencies	Students will be able to:
Demonstrate written communication skills	Write discussion papers to evaluate alternative solutions to ethical dilemmas using professional ethical standards.
Utilize appropriate technology	Use spreadsheet application software to perform basic analytical procedures for a publicly traded company. Interpret the results.

2. Course Specific Outcomes - Students will be able to achieve the following measurable goals upon completion of the course:

• Recognize how ethical principles apply to managerial decision making.
• Explain how the statement of cash flows is used to evaluate a company’s long-term financial health.
• Compute and interpret key financial ratios.
• Describe the primary information needs of management; identify the management accountant’s role in the management team; and compare and contrast financial and managerial accounting.
• Classify costs and prepare the major financial statements of a manufacturer along with a schedule of Cost of Goods Manufactured.
• Distinguish between the traditional types of product costing systems (job-order and process).
• Analyze the impact cost behavior has on breakeven and profit. Modify assumptions using sensitivity analysis for profit planning and decision making.
• Summarize the importance and benefits of budgeting, prepare the components of the master budget, and relate the budget to planning and control.
• Define standard costs; explain how standard cost information is useful for management by exception; and demonstrate how variances from standard are used in responsibility accounting.
• Explain why companies use performance evaluation systems; describe the balanced scorecard; and identify key performance indicators from each perspective.
• Describe, identify, and evaluate information relevant to business decisions.
• Discuss the nature and importance of the capital budgeting process and evaluate capital investment proposals using non-present value and present value models.

V. Topical Outline

Listed below are major areas of content typically covered in this course.

1. Lecture Sessions

• Statement of Cash Flows
  • Basics of cash flow reporting: purpose, importance, and measurement
  • Operating, investing and financing cash flows
  • Noncash investing and financing activities
  • Indirect and direct methods of preparing the Statement of Cash Flows
  • Financial statement analysis and interpretation: free cash flows
• Financial Statement Analysis
  • Horizontal and vertical analyses of financial statements
  • Use of common-size financial statements
  • Standard financial ratios
  • Corporate annual reports
  • Unusual Items
• Introduction to Managerial Accounting
  • Managerial accounting basics
  • Manufacturing operations: costs and terminology
  • Financial statements for a manufacturing business
  • Uses of managerial accounting
• Job Order Costing
  • Cost accounting systems overview
  • Job order cost systems, cost flows, and reports
  • Job order costing for decision-making
  • Job order costing for professional service businesses
• Process Cost Accounting
  • Process operations and systems
  • Cost of production report
  • Process cost accounting
  • Using the cost of production report for decision making
• Cost-Volume-Profit Analysis
  • Cost behavior
  • CVP relationships
  • Different approaches to CVP analysis
  • Use CVP to perform sensitivity analyses
  • Applying CVP analysis
• Budgeting
  • Nature and objectives of budgeting
  • Budgeting systems
  • Master budget components
• Flexible Budgets and Standard Costs
  • Standards
  • Budgetary performance evaluation
  • Cost variances: recording and reporting
  • Nonfinancial performance measures
• Performance Evaluation for Decentralized Operations
  • Centralized and decentralized operations
  • Responsibility accounting: cost, profit, and investment centers
  • Return on investment (ROI), residual income (R), and balanced scorecard
  • Transfer pricing approaches
• Differential Analysis, Product Pricing, and Activity-Based Costing
  • Differential Analysis
  • Qualitative decision factors
  • Setting normal product selling prices
  • Production bottlenecks
  • Activity-based costing method
  • Other costing concepts
• Capital Investment Analysis
  • Nature of capital investment decisions
  • Methods not using present values
  • Methods using present values
  • Complicating factors in capital investment analysis
• Accounting for Partnerships (Optional)
  • Partnership form of organization
  • Basic partnership accounting
  • Admission and withdrawal of partners
  • Liquidation of partnerships
  • Partnership financial statements.

2. Laboratory/Studio Sessions

• Statement of Cash Flows
  • Statements of cash flows
  • Worksheet approach for statement of cash flows
  • =IF function
• Financial Statement Analysis
  • Horizontal/vertical analysis
  • Absolute cell references
  • Ratio analysis
  • Building standard financial statement analysis ratio formulas
  • Pre-built templates
• Introduction to Managerial Accounting
  • Schedule of cost of goods manufactured
  • Format as table
• Job Order Costing
  • Predetermined overhead calculation
  • Job order costing project
• Process Cost Accounting
  • Cost per equivalent unit
  • Cost of production report
• Cost-Volume-Profit Analysis
  • High-low method
  • =VLOOKUP, =MAX, =MIN
• Budgeting
  • Components of master budget
  • Spreadsheet protection
• Flexible Budgets and Standard Costs
  • Direct materials, direct labor, and factory overhead variances
• Performance Evaluation for Decentralized Operations
  • Service department charges
  • Divisional income statement
• Differential Analysis, Product Pricing, and Activity-Based Costing
  • Lease or sell
  • Make or buy
  • Continue or replace
  • Sell or process further
• Capital Investment Analysis
  • =NPV
  • =IRR