ACC 502 Accounting Practices Entire Course

November 25, 2022| admin

ACC 502 Accounting Practices Entire Course

 

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Description

ACC 502 Accounting Practices Entire Course

 

 

Accounting Practices

 

 

 

Course Description

 

 

 

This course is designed for students who are preparing for more advanced coursework in business but who have not had accounting in undergraduate work. Topics covered include the principles and practices of financial accounting, including the fundamentals of revenue recognition, the components of the balance sheet, and financial statement analysis. The course explores accounting theories using publicly traded companies and case studies.

 

 

 

 

 

Instructor Contact Information

 

 

 

Class Resources

 

 

 

GCU Colangelo College of Business Form 10-K Tutorial

 

 

 

 

 

View “GCU Colangelo College of Business Form 10-K Tutorial,” from YouTube (2021), for assistance with locating the Form 10-K for the list of approved companies.

 

 

 

 

 

 

 

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Young, S. D., Cohen, J., & Bens, D. A. (2019). Corporate financial reporting and analysis: A global perspective (4th

 

 

 

ed.). Wiley. ISBN-13: 9781119494577

 

 

 

ACC-502 Common Accounting Ratios

 

 

 

 

 

Review “ACC-502 Common Accounting Ratios” to assist with coursework.

 

 

 

 

 

Understanding the Balance Sheet

 

 

 

Read “Understanding the Balance Sheet,” by Kaiser, from the New Jersey CPA (2020).

 

 

 

https://lopes.idm.oclc.org/login?url=https://search.ebscohost.com/login.aspx? direct=true&db=bth&AN=146883037&site=eds-live&scope=site&custid=s8333196&groupid=main&profile=eds1

 

 

 

 

 

The Accounting Equation

 

 

 

 

 

Review “Accounting Equation,” located on the Principles of Accounting website.

 

 

 

The Accounting Equation

 

 

 

 

 

ACC-502 Discussion Questions

 

 

 

The Four Core Financial Statements

 

 

 

 

 

Review “Four Core Financial Statements,” located on the Principles of Accounting website, for a review of the accounting cycle.

 

 

 

https://www.principlesofaccounting.com/chapter-1/financial-statements/

 

 

 

 

 

 

 

Chapter 3: Income Measurement

 

 

 

 

 

Review “Chapter 3: Income Measurement,” located on the Principles of Accounting website, for a review of revenue and expenses.

 

 

 

Chapter 3: Income Measurement

 

 

 

 

 

 

 

Resources for Locating a Form 10-K

 

 

 

 

 

Review the attached resources for assistance in locating the Form 10-K for the list of approved companies.

 

 

 

 

 

FASB Codification

 

 

 

 

 

GCU is providing access for students and instructors to the Financial Accounting Standards Board (FASB) Codification Professional View and Governmental Accounting Research System (GARS) Online. To obtain the credentials to access the FASB website, select the link provided and enter your credentials (the same credentials you would use to access your digital classroom). You will then receive access to the FASB Codification Access credentials and a link to the American Accounting Association login page.

 

 

 

https://www.gcumedia.com/fasb-accounting-standards/v1.1/#/

 

 

 

 

 

U.S. Securities and Exchange Commission: Filings and Forms

 

 

 

 

 

Use the U.S. Securities and Exchange Commission Filings and Forms website to access free information from the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system, as needed to complete the topic assignments.

 

 

 

https://www.sec.gov/edgar.shtml

 

 

 

 

 

 

 

International Financial Reporting Standards (IFRS) Foundation

 

 

 

 

 

Explore the International Financial Reporting Standards (IFRS) Foundation website.

 

 

 

https://www.ifrs.org/

 

 

 

 

 

 

 

Chapters 6, 8, 10, 13, and 17 Resources

 

 

 

 

 

Assignment answers are provided from the publisher’s test bank to accompany Corporate financial reporting and analysis: A global perspective (4th ed.), by Hoboken, NJ (2019), with permission from the publisher, Wiley Inc.

 

 

 

 

 

 

 

Chapters 6, 8, 10, 13, and 17 Resources

 

 

 

 

 

Assignment answers are provided from the publisher’s test bank to accompany Corporate financial reporting and analysis: A global perspective (4th ed.), by Hoboken, NJ (2019), with permission from the publisher, Wiley Inc.

 

 

 

 

 

 

 

Chapters 6, 8, 10, 13, and 17 Resources

 

 

 

 

 

Assignment answers are provided from the publisher’s test bank to accompany Corporate financial reporting and analysis: A global perspective (4th ed.), by Hoboken, NJ (2019), with permission from the publisher, Wiley Inc.

 

 

 

 

 

 

 

Chapters 6, 8, 10, 13, and 17 Resources

 

 

 

 

 

Assignment answers are provided from the publisher’s test bank to accompany Corporate financial reporting and analysis: A global perspective (4th ed.), by Hoboken, NJ (2019), with permission from the publisher, Wiley Inc.

 

 

 

 

 

 

 

Chapters 6, 8, 10, 13, and 17 Resources

 

 

 

 

 

Assignment answers are provided from the publisher’s test bank to accompany Corporate financial reporting and analysis: A global perspective (4th ed.), by Hoboken, NJ (2019), with permission from the publisher, Wiley Inc.

 

 

 

Accounting Basics Part 1: Application in Healthcare

 

 

 

 

 

Read “Accounting Basics Part 1: Application in Healthcare,” by South-Winter and Porter, from the Radiology Management (2016).

 

 

 

https://lopes.idm.oclc.org/login?url=https://search.ebscohost.com/login.aspx? direct=true&db=ccm&AN=118238159&site=eds-live&scope=site&custid=s8333196&groupid=main&profile=eds1

 

 

 

 

 

Company Overview Assignment Answer Key

 

 

 

 

 

The “Company Overview Assignment Answer Key” is provided for instructors.

 

 

 

LopesWrite

 

 

 

 

 

Refer to the LopesWrite webpage for guidance regarding assignments requiring submission to LopesWrite. https://support.gcu.edu/hc/en-us/articles/201277380-LopesWrite

 

 

 

ACC-502 Course Revision History

 

 

 

Topic 1: Introduction to Financial Accounting

 

 

 

 

 

Resources

 

 

 

Financial Accounting Standards Board (FASB)

 

 

 

 

 

Explore the Financial Accounting Standards Board (FASB) website.

 

 

 

https://www.fasb.org/home

 

 

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Read Chapters 1 and 2 in Corporate Financial Reporting and Analysis: A Global Perspective.

 

 

 

 

 

U.S. Securities and Exchange Commission: Filings and Forms

 

 

 

 

 

Use the U.S. Securities and Exchange Commission Filings and Forms website to access free information from the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system, as needed to complete the topic assignment.

 

 

 

https://www.sec.gov/edgar.shtml

 

 

 

 

 

 

 

Beginners’ Guide to Financial Statement

 

 

 

 

 

Read “Beginners’ Guide to Financial Statement” (2007), located on the U.S. Securities and Exchange Commission (SEC) website.

 

 

 

https://www.sec.gov/reportspubs/investor-publications/investorpubsbegfinstmtguidehtm.html

 

 

 

 

 

 

 

Guide to Financial Statements

 

 

 

 

 

Explore the Guide to Financial Statements page of the IBM website.

 

 

 

https://www.ibm.com/investor/help/guide/

 

 

 

Assessments

 

 

 

Class Introductions

 

 

 

Take a moment to explore your new classroom and introduce yourself to your fellow classmates. What are you excited about learning? What do you think will be most challenging?

 

 

 

Financial Statement Transactions

 

 

 

 

 

The purpose of this assignment is to make adjustments to the financial statements based on new transactions as well as describing various financial reports.

 

 

 

Refer to the Excel spreadsheet, “Company Overview Template,” for the instructions and details to complete this assignment. Name your Excel file LastnameFirstinitial.T1 and submit the file to your instructor.

 

 

 

While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the

 

 

 

 

 

APA Style Guide, located in the Student Success Center.

 

 

 

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are not required to submit this assignment to LopesWrite.

 

 

 

 

 

Topic 1 DQ 1

 

 

 

 

 

External users of financial statements use the information to make key business decisions. Some common users include banks, investors, suppliers, and customers. Briefly describe one reason why one of these stakeholders would evaluate the financial information and provide at least one example to illustrate your ideas. You must provide a minimum of 1 scholarly resource to support your rationale. Participate in follow-up discussion by providing additional reasons and examples that have not already been listed related to the stakeholders’ evaluation of financial statements.

 

 

 

 

 

Topic 1 DQ 2

 

 

 

 

 

Internal users of financial statements use the information to make key business decisions. Some common users include managers, employees, internal accountants, and executives. Briefly describe one reason why one of these stakeholders would evaluate the financial information and provide at least one example to illustrate your ideas. You must provide a minimum of 1 scholarly resource to support your rationale. Participate in follow-up discussion by providing additional reasons and examples that have not already been listed related to the stakeholders’’ evaluation of financial statements.

 

 

 

 

 

Topic 1 Participation

 

 

 

Topic 2: Using Financial Statements in Decision Making

 

 

 

 

 

Resources

 

 

 

New Revenue Recognition Guidance and the Potential for Fraud and Abuse

 

 

 

 

 

Read the “New Revenue Recognition Guidance and the Potential for Fraud and Abuse,” by Carmichael, from the CPA Journal.

 

 

 

https://lopes.idm.oclc.org/login?url=https://search.ebscohost.com/login.aspx?

 

 

 

 

 

direct=true&db=bth&AN=135250784&site=eds-live&scope=site&custid=s8333196&groupid=main&profile=eds1

 

 

 

 

 

Why Global Accounting Standards

 

 

 

 

 

Review the “Why Global Accounting Standards?,” article located on the International Financial Reporting Standards (IFRS) Foundation website.

 

 

 

https://www.ifrs.org/use-around-the-world/why-global-accounting-standards/

 

 

 

 

 

 

 

Starbucks Financial Data – SEC Filings (Form 10-K)

 

 

 

 

 

Review the “Financial Data” page, located on the Starbucks Investor Relations website, to assist with the completion of the topic assignment.

 

 

 

https://investor.starbucks.com/financial-data/sec-filings/default.aspx

 

 

 

 

 

 

 

Initial Course Survey

 

 

 

 

 

In an effort for continuous improvement, Grand Canyon University would like you to take this opportunity to provide feedback about your experience withthe university. Your participation is appreciated. Click on the link to begin the survey.

 

 

 

https://www.surveymonkey.com/r/GCUICS?section_id=[section_id_value]&source_id=[source_id_value]

 

 

 

 

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Read Chapters 3 and 4 in Corporate Financial Reporting and Analysis: A Global Perspective.

 

 

 

 

 

Assessments

 

 

 

 

 

Analyzing Revenue

 

 

 

 

 

The purpose of this assignment is to apply accounting revenue recognition concepts in a case study.

 

 

 

Read the article “Revenue Recognition Guidance and the Potential for Fraud and Abuse,” located in the Topic resources. In addition, refer to the Starbucks Financial Data – SEC Filings, Form 10-K for the most recent fiscal year and locate the note on revenue recognition in the notes to the financial statements. Provide a 500- to 750-word paper addressing the following items:

 

 

 

 

 

Summarize the five-step revenue recognition standards as presented in Chapter 4 of the textbook. Refer to the Starbucks Form 10-K and provide examples of how Starbucks follows the five-step revenue recognition model.

 

Refer to the article “Revenue Recognition Guidance and the Potential for Fraud and Abuse” and discuss how the five-step revenue recognition model may prevent Starbucks from committing financial statement fraud. Provide examples to support your points. Note in the article that there are subheadings for “Fraud and Abuses” and “Implications of New Guidance;” these may provide some helpful ideas for this portion of the assignment.

 

 

 

Name the Microsoft Word document “LastnameFirstinitial.ACC502.T2.”

 

 

 

Prepare this assignment according to the guidelines found in the APA Style Guide, located in the Student Success Center. An abstract is not required. This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are required to submit this assignment to LopesWrite. A link to the LopesWrite technical support articles is located in Class Resources if you need assistance.

 

 

 

 

 

Topic 2 DQ 1

 

 

 

 

 

The textbook provides three key qualitative characteristics of financial information (relevance, reliability, and consistency). Describe one of these three terms and explain its influence on the financial statements. Include a numerical example to prove your points. Participate in follow-up discussion by reading classmates’ posts and providing an example on the significance to the user if the qualitative characteristics are not followed in the preparation of financial statements.

 

 

 

 

 

Topic 2 DQ 2

 

 

 

 

 

As mentioned in Chapter 3 of the textbook, International Financial Reporting Standards (IFRS) are generally utilized by non-U.S.-based companies. Both IFRS and GAAP standards follow core principles such as asset valuation, revenue recognition, and the matching principle. However, the standards may approach financial reporting differently. Review the resource “Why Global Accounting Standards?” and provide an opinion on whether U.S. companies should convert to the global standards based on the information you gathered from the IFRS readings. Participate in follow-up discussion by trying to professionally persuade classmates who have a different opinion on convergence, addressing why your logic is more appropriate for U.S. businesses.

 

 

 

 

 

Topic 2 Participation

 

 

 

Topic 3: Analyzing Current Assets for Decision Making

 

 

 

Max Points: 125

 

 

 

Resources

 

 

 

11+ Financial Memo Examples in PDF, MS Word, Pages, Google Docs

 

 

 

 

 

Read “11+ Financial Memo Examples in PDF, MS Word, Pages, Google Docs,” located on the Examples.com website.

 

 

 

https://www.examples.com/business/financial-memo.html

 

 

 

 

 

 

 

The Coca-Cola Company: Annual Filings

 

 

 

 

 

Review the “Annual Filings” page, located on the Coca-Cola Company website, to assist with the completion of the topic assignment.

 

 

 

https://investors.coca-colacompany.com/filings-reports/annual-filings-10-k

 

 

 

 

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Read Chapters 8 and 9 in Corporate Financial Reporting and Analysis: A Global Perspective.

 

 

 

PepsiCo: SEC Filings

 

 

 

 

 

Review the “SEC Filings” page, located on the PepsiCO website, to assist with the completion of the topic assignment.

 

 

 

https://www.pepsico.com/investors/financial-information/sec-filings

 

 

 

Assessments

 

 

 

Analyzing Inventory Ratios

 

 

 

The purpose of this assignment is to calculate asset ratios, then analyze and compare them between two competitors in the same industry.

 

 

 

Review the most recent annual reports of The Coca Cola Company and PepsiCo and focus on the balance sheet and inventory note included in the notes to the financial statements. Calculate the following ratios for each company for the last 2 years using Microsoft Excel. Be sure you are utilizing the correct formulas and a separate tab for each ratio:

 

 

 

Inventory turnover

 

 

Average days in inventory

 

 

In a Microsoft Word file, prepare a memo to the instructor discussing the following. Be sure to include a minimum of one paragraph per company to support your findings.

 

 

 

Explain the meaning of each ratio and what the calculated results tell you about each of the companies. Refer to the calculated ratios in your analysis. Your explanation should consider how the ratios have changed in the last 2 years. Your explanation should include a separate paragraph for each ratio.

Summarize how effective each company is in managing inventory based upon the type(s) of products the company sells and the industry in which it competes. Include discussion about whether the inventory turnover ratio is increasing or decreasing, what is causing the ratio increase/decrease, and whether the total value of inventory is increasing or decreasing on the balance sheet.

 

 

General Requirements:

 

 

 

Submit the Excel file that contains your ratios and a separate Word file using an appropriate memo template.

 

 

 

Please include a reference page as the last page of the memo document.

 

 

 

Name the Excel file “LastnameFirstinitial.T3Ratios” and name the Word document “LastnameFirstinitial.T3Memo.”

 

 

 

While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.

 

 

 

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are required to submit this assignment to LopesWrite. A link to the LopesWrite technical support articles is located in Class Resources if you need assistance.

 

 

 

 

 

Topic 3 DQ 1

 

 

 

Using the first letter of your last name, answer the question below for which the letter of your name falls in the range. Use your own words to summarize the information from the textbook. Provide proper citations for sources used, including the textbook. Review the resources provided to assist with completion.

 

 

 

A – M: Calculate the accounts receivable turnover and the average collection period ratio for The Coca-Cola Company for the most current year presented. Explain what the results indicate about the company. Summarize how well Coca-Cola is collecting on its receivables based upon the type(s) of products it sells and the industry in which it competes. Justify your speculation by using supporting facts from the income statement, balance sheet, or other resources.

 

N – Z: Calculate the accounts receivable turnover and the average collection period ratios for PepsiCo for the most current year presented. Explain what the results indicate about the company. Summarize how well PepsiCo is collecting on its receivables based upon the type(s) of products it sells and the industry in which it competes. Justify your speculation by using supporting facts from the income statement, balance sheet, or other resources

 

 

 

Participate in follow-up discussion by comparing the ratios for both companies and explaining what they mean in relation to each other. Also, discuss what specific actions each company should take to improve its ratios. Consider if there are any other ratios that can be looked at to analyze accounts receivable.

 

 

 

Topic 3 DQ 2

 

 

 

 

 

Respond to Question 5 from Chapter 8 of the textbook: Consider the following statement: “The fewer the uncollectible accounts, the better.” Can you think of instances where this might not be the case? Support your points with an example of why fewer uncollectible accounts may not be better for business. Participate in follow-up discussion by reviewing the fact patterns described by classmates and change them to try to prove the point that fewer uncollectible accounts are not better.

 

 

 

 

 

Topic 3 Participation

 

 

 

Topic 4: Analyzing Long-Term Assets for Decision Making

 

 

 

Resources

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Read Chapters 10 and 17 in Corporate Financial Reporting and Analysis: A Global Perspective.

 

 

 

Assessments

 

 

 

Long-Term Asset Capitalization

 

 

 

 

 

The purpose of this assignment is to analyze long-term assets in the financial statements, and to consider financial implications associated with long-term assets.

 

 

 

Complete Problem 10.5 from the textbook.

 

 

 

Use Microsoft Excel to show the calculations of depreciation prior to and after the recommended changes. In addition, in a Microsoft Word document, write a memo from Patty Chu to Patty’s boss comparing the results of the old and new depreciation expense amounts. Within the memo, discuss the impact to the income statement and balance sheet if these changes are approved. Finally, provide a recommendation on whether the changes should be made; use your calculations to support your position.

 

 

 

Name the Excel file “LastnameFirstinitial.ACC502.T4,” where the T4 refers to Topic 4 assignment.

 

 

 

Name the Word document “LastnameFirstinitial.ACC502.T4memo.”

 

 

 

While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.

 

 

 

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are not required to submit this assignment to LopesWrite.

 

 

 

 

 

Topic 4 DQ 1

 

 

 

 

 

As indicated in the reading, U.S. GAAP requires the use of historical cost for valuing most assets while IFRS permits the use of fair value. Using the first letter of your last name, answer the question below for which the letter of your name falls in the range. Use your own words to summarize the information from the textbook. Provide proper citations for resources used, including the textbook.

 

 

 

A – M: Assume you are in support of the historical cost basis as required by GAAP. Discuss why you think the historical cost approach best values the long-term assets on the balance sheet. In addition, provide an example to support your position.

 

N – Z: Assume you are in support of the fair value basis as recommended by IFRS. Discuss why you think the fair value approach best values the long-term assets on the balance sheet. In addition, provide an example to support your position.

 

 

 

Participate in follow-up discussion by responding to classmates who posted about the opposite approach and professionally debate why the approach you reported on is the better method for valuing the long-term assets on the balance sheet.

 

 

 

 

 

Topic 4 DQ 2

 

 

 

 

 

Refer to Question 10 in Chapter 17 of the textbook: How is the use of the equity method subject to manipulation? How might a financial statement reader detect such behavior? In addition, provide an example to prove how the equity method may result in manipulation of the financial results.Participate in follow-up discussion by providing recommendations to classmates’ fact patterns on how a company could implement procedures to prevent manipulation of the use of the equity method

 

 

 

 

 

Topic 4 Participation

 

 

 

 

 

Topic 5: Analyzing Liabilities for Decision Making

 

 

 

 

 

Resources

 

 

 

11+ Financial Memo Examples in PDF, MS Word, Pages, Google Docs

 

 

 

 

 

Review “11+ Financial Memo Examples in PDF, MS Word, Pages, Google Docs,” located on the Examples.com website.

 

 

 

https://www.examples.com/business/financial-memo.html

 

 

 

 

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Read Chapters 6, 11, and 13 in Corporate Financial Reporting and Analysis: A Global Perspective.

 

 

 

Assessments

 

 

 

 

 

 

 

Analyzing Liabilities

 

 

 

 

 

The purpose of this assignment is to analyze liabilities when making business decisions.

 

 

 

Read Case Study 13-1, “Accounting for Contingent Assets: The Case of Cardinal Health,” from Chapter 13 in the textbook.

 

 

 

In a 250- to 500-word executive summary to the Cardinal Health CEO, address the following:

 

 

 

Explain the potential justification for deducting the expected litigation gain from cost of goods sold, and explain why Cardinal Health chose this alternative rather than reporting it as a nonoperating item.

Explain what the senior Cardinal Health executive meant when he said, “We do not need much to get over the hump, although the preference would be the vitamin case so that we do not steal from Q3.” Include specific clarification of the phrase “not steal from Q3.”

Explain specifically what Cardinal Health did to get into trouble with the SEC.

 

 

Justify the timing of the $10 million and $12 million gains, and explain how Cardinal Health’s senior managers defend these decisions.

Cardinal Health received more than $22 million from the litigation settlement. Discuss whether the actions of Cardinal Health senior managers were so wrong that they justified the actions of the SEC. Classify Cardinal Health’s behavior on a scale from 1-10, with 1 being “relatively harmless” and 10 being “downright fraudulent.” Justify your rating.

 

 

Prepare this assignment according to the guidelines found in the APA Style Guide, located in the Student Success Center. An abstract is not required.

 

 

 

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are required to submit this assignment to LopesWrite. A link to the LopesWrite technical support articles is located in Class Resources if you need assistance.

 

 

 

 

 

Topic 5 DQ 1

 

 

 

 

 

The ability for a company to meet its liability obligations is important when assessing financial stability. Consider what high liability balances might indicate about a company and explain the pros and cons of this type of balance. Provide real-world examples to illustrate your ideas. Participate in follow-up discussion by discussing whether you agree or disagree with the assessment provided and offer additional examples to justify your position.

 

 

 

 

 

Topic 5 DQ 2

 

 

 

 

 

The principles regarding leases were recently updated by FASB, as discussed in the textbook. Explain two main differences between finance and operating leases under these new lease provisions.Select a publicly traded company and access its most recent financial statements, form 10-K. Include the name of the company in your subject line, and do not choose a company about which one of your classmates has already posted. Navigate to the notes to the financial statements and locate the company’s note on lease disclosures. Identify if the company has operating leases, financing leases, or both. Explain how you can tell which type of leases the company utilizes. Is the company properly reporting leases using the new standard? How can you tell? Participate in follow-up discussions by comparing the lease reporting of your company to that of a classmate’s company and comment on any similarities or differences between the companies.

 

 

 

 

 

Topic 5 Participation

 

 

 

 

 

Topic 6: Understanding Equity

 

 

 

 

 

Resources

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Read Chapter 16 in Corporate Financial Reporting and Analysis: A Global Perspective.

 

 

 

 

 

Assessments

 

 

 

 

 

Analyzing Stockholders’ Equity

 

 

 

 

 

The purpose of this assignment is to analyze stockholders’ equity to recommend strategies for generating cash. Understanding a company’s position as it relates to stockholders and stockholders’ equity is important when considering options and making decisions related to the strategies that should be implemented to generate cash for the company.

 

 

 

The chief executive officer (CFO) of the company wants to generate cash for the organization and has tasked you to review the current stockholders’ equity position for the company and use your findings to recommend strategies for generating cash flow. The CEO has requested you summarize your findings in a memo that is addressed to the CFO, but one that could be shared with other stakeholders.

 

 

 

Refer to the “Annual Reports for Approved Companies” and access the Form 10-K for one of the companies.

 

 

 

Review and study the following information related to stocks:

 

 

 

Identify and discuss the current types of stock, such as common or preferred stock, currently issued, and outstanding. Include a narrative description along with the values and number of shares found on the balance sheet.

Identify the presence of treasury stock and its impact on overall stockholders’ equity. If the company does not have treasury stock, indicate the absence of treasury stock and provide some discussion as to why the company may not have purchased back any of its originally issued stock.

Review the notes to the financial statements to determine if the company has any convertible bonds and summarize the characteristics of those bonds. If there are no convertible bonds in the notes, discuss why a company may want to consider convertible bonds in the future.

Discuss the pros and cons of issuing new stock, reissuing treasury stock (if applicable), and issuing convertible bonds.

In addition, include your recommendations on how the company could generate cash from issuing new common stock, preferred stock, convertible bonds or reissuing treasury stock. Support your recommendations with examples that show the impact on cash.

 

 

General Requirements:

 

 

 

Using the five items above as a guide, summarize your findings and recommendations for the CFO.

 

 

 

Submit the Word memo document to the dropbox. with the naming convention LastnameFirstinitial.T6memo.

 

 

 

While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.

 

 

 

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are required to submit this assignment to LopesWrite. A link to the LopesWrite technical support articles is located in Class Resources if you need assistance.

 

 

 

 

 

Topic 6 DQ 1

 

 

 

 

 

The stockholders’ equity section of the balance sheet typically includes the line items of retained earnings, common stock, treasury stock, and other comprehensive income. Select one company to analyze using the list of approved companies. Select two of these line items and explain what their balances might indicate about how the company is utilizing the investment by its stockholders. In your response, address whether you would want to purchase stock in the company based on your analysis. Participate in follow-up discussion by reviewing the information provided by classmates and providing your opinion as to whether you would purchase the company’s stock. In your response, compare your opinions and note any significant similarities or differences

 

 

 

 

 

Topic 6 DQ 2

 

 

 

 

 

Companies may issue common or preferred stock to generate cash flow. However, sometimes companies will buy back stock that was issued to shareholders. Discuss at least one reason why a company would buy back its own stock and provide an example to support your points. In addition, discuss any potential negative effects of the stock repurchase. Participate in follow-up discussion by changing the fact patterns provided by classmates to show when/why a company may want to reissue its treasury stock. Provide an example to support your points

 

 

 

 

 

 

 

Topic 6 Participation

 

 

 

Topic 7: Understanding the Statement of Cash Flows

 

 

 

 

 

 

 

Resources

 

 

 

Loom Help Center

 

 

 

 

 

Utilize topics from the “Loom Help Center” for assistance on installing the software and software usage.

 

 

 

https://support.loom.com/

 

 

 

 

 

 

 

Loom

 

 

 

 

 

Loom is a free video recording tool that allows you send messages through shareable videos. For assistance on installing the software or usage, navigate to the­Loom Help Center.

 

 

 

https://support.gcu.edu/hc/en-us/articles/115015942807-Third-Party-Contact-Information

 

 

 

 

 

Corporate Financial Reporting and Analysis: A Global Perspective

 

 

 

 

 

Review Chapters 6 and 17 and read Chapters 5 and 7 in Corporate Financial Reporting and Analysis: A Global Perspective.

 

 

 

 

 

Assessments

 

 

 

 

 

Analyzing Statement of Cash Flows

 

 

 

 

 

The purpose of this assignment is to analyze a statement of cash flows to determine the financial strengths and weaknesses of a company.

 

 

 

Understanding a company’s major sources and uses of cash, and how cash is being used in the business through the analysis of the statement of cash flows, is essential. This analysis guides financial decision-making and is used to determine financial strengths and weaknesses within the company.

 

 

 

The accounting manager has asked you to prepare a 5- to 10-minute presentation for company stakeholders summarizing your analysis of the statement of cash flows and the financial strengths and weaknesses of the company.

 

 

 

Using the company that you selected from the approved list, review the Management Discussion and Analysis (MD&A) section of the annual report and the management’s discussion regarding the statement of cash flows or any discussion on the operating, investing, or financing activities of the company. In addition, refer to the statement of cash flows financial statement.

 

 

 

Create a PowerPoint presentation (5-8 slides) that summarizes your analysis and addresses the following.

 

 

 

Include screenshots from the statement of cash flows as needed to illustrate key findings and information.

 

 

 

Discuss the company’s major sources of cash in each of the three sections of the statement of cash flows. Provide at least two major sources of cash for each section.

Discuss the company’s major uses of cash in each of the three sections of the statement of cash flows. Provide at least two major sources of cash for each section.

Discuss the major differences between the net income and the cash provided or used by operating activities, and explain the cause of the major difference between the two values. Note that you may need to reconcile the differences between net income reported and the subtotal of cash provided or used by “operating” activities. What were the reconciling items, how were these accounts adjusted, and why do we not just report “net income” without adjustments?

 

 

Summarize the financial strengths of the business and justify your analysis based on evidence in the statement of cash flows. Include discussion as to whether or not you anticipate the company will experience continued success and explain your answer. Only information from the statement of cash flow should be referenced. Note that this analysis will be more than just the amounts of either the cash provided or used. You may need to review the notes in the MD&A for additional information.

 

 

Summarize the financial weaknesses of the business and justify your analysis based on evidence in the statement of cash flows. Include discussion as to whether or not you anticipate the company will experience continued challenges in this area and explain your answer. Only information from the statement of cash

 

 

 

 

flows should be referenced. Note that this analysis will be more than just the amounts of either the cash provided or used. You may need to review the notes in the MD&A for additional information.

 

 

 

General Requirements:

 

 

 

Refer to the resource, “Creating Effective PowerPoint Presentations,” located in the Student Success Center, for additional guidance on completing this assignment in the appropriate style.

 

 

 

Using the PowerPoint you created, practice your presentation. Speaker notes are not required. Use Loom to record your 5- to 10-minute presentation for the company stakeholders and submit the PowerPoint presentation, with the embedded Loom link on the title slide of the presentation, to the instructor. Refer to the provided resources for additional guidance on recording your presentation with Loom.

 

 

 

While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.

 

 

 

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are not required to submit this assignment to LopesWrite.

 

 

 

 

 

Topic 7 DQ 1

 

 

 

 

 

Using the company that you selected from the approved list, access its most recent financial statements, form 10-K. Include the name of the company in your subject line, and if possible, do not choose a company about which one of your classmates has already posted. Navigate to the statement of cash flows that was prepared using an indirect method. Discuss an item that was included when calculating net income, but is adjusted as an increase or decrease to determine cash provided by (used in/by) operating activities. Note, increases and decreases in the operation activities section of the cash flows result from changes in current assets, current liabilities, gains, and losses. Include a summary of how that particular item impacted net income (or net loss) and why an adjustment might be necessary to reconcile net income to net cash flows from operating activities. If possible, use an item not already used in a classmate’s post. In your post, include a screenshot of the statement of cash flows you are analyzing or provide the URL and applicable page number for the statement of cash flows. Participate in follow-up discussion by providing additional explanation on items identified by your classmates.

 

 

 

 

 

 

 

Topic 7 DQ 2

 

 

 

 

 

Many small business owners focus on the cash balance in their bank accounts and may not use the statement of cash flows to analyze how their businesses are generating or using cash. Discuss what one piece of information is found on the statement of cash flows that is just as important as the bank balance (or more so) for the purpose of understanding the financial position of a company. Participate in follow-up discussion by adding additional detail or asking additional questions to the posts of a classmate regarding the differences and similarities between the statement of cash flows and the income statement information.

 

 

 

 

 

Topic 7 Participation

 

 

 

 

 

Topic 8: Ratio Analysis

 

 

 

 

 

 

 

Feb 17, 2022 – Feb 23, 2022     Max Points: 125

 

 

 

Resources

 

 

 

IBIS World

 

 

 

 

 

Use the IBIS World website to conduct research relevant to the topic assignment.

 

 

 

https://clients1-ibisworld-com.lopes.idm.oclc.org/? u=IIutpBauyool4WmllM/5oA==&p=f3aDZevXCrh947ZxXG+Liw==

 

 

 

 

 

The Motley Fool

 

 

 

 

 

Explore The Motley Fool website to conduct research relevant to the topic assignment.

 

 

 

https://www.fool.com/

 

 

 

 

 

 

 

Business Source Complete – Publications

 

 

 

 

 

Use the Business Source Complete – Publications database in the GCU Library to access “Morningstar, Inc.

 

 

 

MarketLine Company Profile” to conduct research relevant to the topic assignment.

 

 

 

http://xs6th8dt4r.search.serialssolutions.com/log?

 

 

 

L=XS6TH8DT4R&D=EBU&J=JC_027899101&P=EJP&PT=EZProxy&H=99f534d3cf&U=https%3A%2F%2Flopes.idm.oc lc.org%2Flogin%3Furl%3Dhttps%3A%2F%2Fsearch.ebscohost.com%2Fdirect.asp%3Fdb%3Dbth%26jid%3DHXI L%26scope%3Dsite

 

 

 

 

 

Business Market Research Collection

 

 

 

 

 

Use the Business Market Research Collection in the GCU Library to access “Hoover’s Company Records; Fort Mill” content to conduct research relevant to the topic assignment.

 

 

 

https://search-proquest-com.lopes.idm.oclc.org/marketresearch/publication/27377/ citation/586566AC41A64EFBPQ/1?accountid=7374

 

 

 

 

 

Assessments

 

 

 

Investment Recommendations

 

 

 

 

 

The purpose of this assignment is to analyze the financial performance of a company to make recommendations to potential investors about the purchase of stock. Studying all aspects of a company’s financial statements is necessary in order to understand the financial performance and health of a company. This is particularly important for investors trying to determine whether to buy stock in the company.

 

 

 

An investor has approached you about whether purchasing stock in the company would be a wise investment. Using your financial analysis of one of the approved companies, you will send a letter to the investor summarizing your findings and explaining whether or not you recommend a stock purchase at this time. Refer to the “Annual Reports for Approved Companies,” located in the Class Resources. You will use information in the Form 10-K to complete this assignment. Using the correct formulas and a separate tab for each analysis, calculate the following ratios using Microsoft Excel:

 

 

 

Three liquidity ratios for the past 2 years

 

 

Three solvency ratios for the past 2 years

 

 

Three profitability ratios for the past 2 years

 

 

In addition, use the list of approved companies within the same industry to conduct research about a competitor company. Using IBIS World or another applicable resource, locate three ratios for the competitor company. Compare your company to the competitor company and indicate the differences in the ratios for the two organizations. Next, locate the same three ratios for the industry. Compare your company to the industry average and discuss how well it is performing compared to the industry. Note: you are not required to calculate the ratios for this portion of the assignment, but proper citations are required for the ratios used in the comparison. Justify your analysis by explaining your findings.

 

 

 

Using your research findings and analysis of company performance in relation to industry competitors, construct a 500- to 750-word letter making stock purchase recommendations for a potential investor. In the letter, address the following, referencing specific ratios and comparative numbers as appropriate:

 

 

 

Discuss the overall financial performance of your company in relation to the specific competitor.

 

 

Discuss whether the company performed better or worse than the industry average, providing specific numbers and an explanation of what the numbers illustrate. For this portion of the memo, consider the 21 questions in Chapter 6 of the textbook to explain what the ratio results tell the user of the financial statements about the health of the company. Instead of providing calculations or showing numerical comparison(s), describe the performance of the company and use the ratio results to support your points.

 

 

Recommend whether the potential investor should purchase stock in your company and justify your recommendation based upon your research and analysis of the company ratios and industry competition.

 

 

Submit the Excel file that contains your ratios and the Word file letter to the digital classroom.

 

 

 

While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.

 

 

 

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

 

 

 

You are required to submit this assignment to LopesWrite. A link to the LopesWrite technical support articles is located in Class Resources if you need assistance.

 

 

 

Topic 8 DQ 1

 

 

 

 

 

In the textbook there are 21 questions provided regarding items to consider when conducting an industry analysis. Review the questions listed on pages 116 and 117. Choose three that you think are the most important of all questions provided. Discuss why those three items are important when conducting an industry analysis. Participate in follow-up discussion by reviewing classmates’ posts and discussing whether the cost leadership or differentiation competitive strategy would be the most effective approach based on the three items provided.

 

 

 

 

 

Topic 8 DQ 2

 

 

 

Chapter 6 provides various exhibits regarding common-size balance sheets or income statements. Refer to Exhibit 6.3 Common-size Financial Statements in the textbook and review the common-size approach. Describe what “common-size” means and why it is used in financial analysis. Using a company from the approved list, perform common-size analysis on the balance sheets or income statements for at least two fiscal years. What does the information tell you? How can you use that information to compare companies within the same industry to each other?

 

 

 

Participate in follow-up discussion by reviewing the results provided by classmates and comment on the usefulness (or lack thereof) of the common-size approach to analyzing financial performance.

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