INTERMEDIATE FINANCIAL ACCOUNTING II Course Syllabus ACG 3113, Summer Tuesday, 12:45-1:45 PM and Thursday, 4:45-5:45 PM

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1 INTERMEDIATE FINANCIAL ACCOUNTING II Course Syllabus ACG 3113, Summer 2013 Professor: Office: Office Hours: Telephone: Debra T. Sinclair, PhD, CVA, CMA PNM 106 A Tuesday, 12:45-1:45 PM and 4:45-5:45 PM Class Meeting Schedule: Class meets as follows: Class Meeting Days Final Exam Section and Times Date and Time Location 691 Tuesday and Thursday July 18 DAV 104 6:00-8:30 PM 6:00 PM 8:30 PM PREREQUISITE: The student must have completed ACG 3103 with a grade of C or better. COURSE DESCRIPTION: This course is a continuation of ACG Topics covered include property, plant and equipment, intangibles, current liabilities, long-term debt, stockholders equity, earnings per share computations, and investments. REQUIRED MATERIALS: Kieso, D.E., J.E. Weygandt and T.D. Warfield. Intermediate Accounting, 14th ed. 2012, John Wiley & Sons, Inc., New Jersey. You can access the course web site at You will need a USF NetID and password in order to have access. If you do not already have a USF NetID, you can obtain one by going to clicking on Activate your NetID, and filling out a few simple forms. A USF id card may be required for USF NetID activation. I expect you to have a thorough knowledge of the accounting principles, concepts, and standards that you have learned in prior courses. Therefore, you should rely on your prior textbooks and other materials to refresh yourselves on the accounting rules for any of the topics we cover in this class.

2 COURSE GOALS AND OBJECTIVES: Students completing ACG 3113 will have developed knowledge and skills in the following areas: I. Acquisition and Disposition of Property, Plant, and Equipment Describe property, plant and equipment. Identify the costs to include in initial valuation of property, plant, and equipment. Describe the accounting problems associated with self-constructed assets. Describe the accounting problems associated with interest capitalization. Understand accounting issues related to acquiring and valuing plant assets. Describe the accounting treatment for costs subsequent to acquisition. Describe the accounting treatment for the disposal of property, plant, and equipment. II. Depreciation, Impairments, and Depletion Explain the concept of depreciation. Identify the factors involved in the depreciation process. Compare activity, straight-line, and decreasing-charge methods of depreciation. Explain special depreciation methods. Explain the accounting issues related to asset impairment. Explain the accounting procedures for depletion of natural resources. Explain how to report and analyze property, plant, equipment, and natural resources. Describe income tax methods of depreciation. III. Intangible Assets Describe the characteristics of intangible assets. Identify the costs to include in the initial valuation of intangible assets. Explain the procedure for amortizing intangible assets. Describe the types of intangible assets. Explain the conceptual issues related to goodwill. Describe the accounting procedures for recording goodwill. Explain the accounting issues related to intangible-asset impairments. Identify the conceptual issues related to research and development costs. Describe the accounting for research and development and similar costs. Indicate the presentation of intangible assets and related items. Understand the accounting treatment for computer software costs. IV. Current Liabilities and Contingencies Describe the nature, type and valuation of current liabilities. Explain the classification issues of short-term debt expected to be refinanced. Identify types of employee-related liabilities. Identify the criteria used to account for and disclose gain and loss contingencies. Explain the accounting for different types of loss contingencies. Indicate how to present and analyze liabilities and contingencies. V. Long-term Liabilities Describe the formal procedures associated with issuing long-term debt. Identify various types of bond issues.

3 Describe the accounting valuation for bonds at date of issuance. Apply the methods of bond discount and premium amortization. Describe the accounting for the extinguishment of debt. Explain the accounting for long-term notes payable. Explain the reporting of off-balance-sheet financing arrangements. Indicate how to present and analyze long-term debt. Describe the accounting for a debt restructuring. VI. Stockholders Equity Discuss the characteristics of the corporate form of organization. Identify the key components of stockholders equity. Explain the accounting procedures for issuing shares of stock. Describe the accounting for treasury stock. Explain the accounting for and reporting of preferred stock. Describe the policies used in distributing dividends. Identify the various forms of dividend distributions. Explain the accounting for small and large stock dividends, and for stock splits. Indicate how to present and analyze stockholders equity. Explain the different types of preferred stock dividends and their effect on book value per share. VII. VIII. Dilutive Securities and Earnings per Share Describe the accounting for the issuance, conversion, and retirement of convertible securities. Explain the accounting for convertible preferred stock. Contrast the accounting for stock warrants and for stock warrants issued with other securities. Describe the accounting for stock compensation plans under generally accepted accounting principles. Discuss the controversy involving stock compensation plans. Compute earnings per share in a simple capital structure. Compute earnings per share in a complex capital structure. Explain the accounting for stock-appreciation right plans. Compute earnings per share in a complex situation. Investments Identify the three categories of debt securities and describe the accounting and reporting treatment for each category. Understand the procedures for discount and premium amortization on bond investments. Identify the categories of equity securities and describe the accounting and reporting treatment for each category. Explain the equity method of accounting and compare it to the fair value method for equity securities. Describe the accounting for the fair value option. Discuss the accounting for impairments of debt and equity investments. Explain why companies report reclassification adjustments.

4 Describe the accounting for transfer of investment securities between categories. Explain who uses derivatives and why. Understand the basic guidelines for accounting for derivatives. Describe the accounting for derivative financial instruments. Explain how to account for a fair value hedge. Explain how to account for a cash flow hedge. Identify special reporting issues related to derivative financial instruments that cause unique accounting problems. Describe the accounting for variable-interest entities. KEY LEADERSHIP SKILL(S) AND PERSPECTIVES ADDRESSED IN THIS COURSE: Interpersonal and Analytical and Critical Information Reflective Ethical and Social Multicultural Communication Thinking Skills Technology Thinking and Consciousness Competence Skills Skills Experiential Learning 5 (a) 3 (b) 1=light treatment and 5=the highest level of integration (a) All classroom discussions, homework and exams emphasize problem solving and data analysis skills. (b) The course lecture and homework emphasize ethical decisions in today's business world. UNIVERSITY & COLLEGE POLICY Honor System: Under the USF Honor System, each student is expected to observe complete honesty in all academic matters. Violation of the Honor System will be referred to the Honor Council. Note: The following are violations of the Honor Code: Copying another student s homework, signing another student s name on the attendance roster, copying another group s disk or written work, using another student s computer disk to print out your assignment, copying another student s file onto your disk, and misrepresenting a reason for a missed exam. Plagiarism or cheating on course work or on examinations will result in penalties that may include a grade of F for the specific exam or course work and a grade of F or FF for the course. Any incident of academic dishonesty will be reported to the Dean of the College. Definitions and punishment guidelines for Plagiarism, Cheating, and Student Disruption of the Academic Process may be found in the USF Policy on Academic Dishonesty & Disruption of the Academic Process at: Students with Disabilities: Please notify your instructor by the second class meeting if you have a learning disability or require special assistance with this course. Confidential personal and learning assistance counseling are made available to students through the Division of Student Affairs. Contact R. Barry McDowell, St. Petersburg Campus: TER 200 (727) , (mcdowell@stpt.usf.edu) for more information. Religious Observances: Students who anticipate the necessity of being absent from class due to the observance of a major religious holiday must provide notice of the date(s) to the instructor, in writing, by the second class meeting.

5 Copyrights: Students who wish to audiotape lectures can do so with direct permission from the professor, but tapes and lectures may not be sold. No videos or photos can be taken in the classroom! Incomplete Grades: An I grade may be given to an undergraduate student only when a small portion of the student s work (normally 30% or less) is incomplete due to circumstances beyond the control of the student and only when a student is otherwise earning a passing grade. I grades are to be used only in emergency situations and cannot to be used as a means of avoiding a poor grade. Normally these are only for medical emergencies and require a signed letter from a medical professional that the student was prevented from attending class. The student must petition the professor before the week of final exams for a grade of I to be given. Grade Forgiveness: Grade forgiveness is limited to three USFSP courses with no more than one repeat per course. Accounting majors can use the forgiveness only once in upper level accounting courses. Withdrawal: No W grades can be obtained after the official drop or withdrawal date (indicate date for each semester). All students enrolled as of the withdrawal date (indicate date for each semester), will receive a letter grade. Emergency Preparedness: In the event of an emergency, it may be necessary for USF to suspend normal operations. During this time, USF may opt to continue delivery of instruction through methods that include but are not limited to: Blackboard, Elluminate, Skype, and messaging and/or an alternate schedule. It is the responsibility of the student to monitor Blackboard site for each class for course specific communication, and the main USF, College, and department websites, s, and MoBull messages for important general information. Bomb Threat or other Disruption: All scheduled classes will be held in an alternate room in the case of a bomb scare, fire alarm or other disruption. Students will gather outside of the classroom building in the STG parking lot so that an alternative room may be announced. S/U Grades: This course may not be taken on an S/U basis. Professional Behavior & Disruptions to the Academic Process: If you bring a cell phone, pager or any other communication device to class, please be sure to turn it off and do not use it in the classroom. These devices are not to be used during an exam. Students are expected to conduct themselves at all times in a professional manner, including regular class attendance, alertness and interest in the class. Students are expected to attend class and make positive contributions to class discussions where appropriate and/or when called on. Unprofessional behavior includes, but is not limited to: arriving to class late, returning from breaks late, leaving class during a lecture, cell phone ringing, reading the newspaper during class, talking excessively, leaving class, sleeping in class, or engaging in any other behavior that is disruptive or disrespectful. Turn cell phone sound off during class! Cameras, laptops and other Internet enabled technologies are not allowed in the classroom without express authorization. Students who surf on the laptop during class will be denied use thereafter. Academic disruptions will be dealt with according to university policy.

6 CLASS POLICIES: In addition to the university policies enumerated above, the following policies pertain to this class, specifically. ATTENDANCE: You are all adults. As adults, you are responsible for managing your time and setting your priorities. As adults, you must also accept responsibility for your choices. Therefore, I do not require you to attend class. However: Learning accounting requires a substantial amount of work on your part. I have found that most students cannot keep up with the work without coming to class; I elaborate on things in the book. I also cover things in class that are not in the book. You are responsible for everything covered in class as well as everything assigned in the textbook; The Schedule of Assignments is tentative. Assignment due dates are subject to change depending upon how quickly (or slowly) we move in class. Additionally, the chapters covered on each exam are subject to change. You are responsible for knowing any revisions to the schedule, regardless of your attendance; I will not be a tutor during office hours to those who regularly miss classes. If you chose not to attend class, you are responsible for learning the materials on your own. PREPARATION FOR CLASS: Because of time constraints, all of the material cannot be covered in class. In-depth reading of the assigned chapters is essential for your understanding of the concepts. Working the assigned homework and perhaps some extra exercises and problems is also advised. You are responsible for your learning. To assist you, I have posted the answers to all of the exercises and problems on Blackboard. I cannot emphasis enough the importance of you really learning, rather than just memorizing, this material. I suggest you approach the class as follows: (1) Read the chapters prior to class. Make sure that you understand the concepts and take detailed notes. Your notes should be so good that you should not have to reread the chapter when studying; (2) Come to class prepared which mean that you should bring your book as well as the notes you have taken on the chapter and a calculator; (3) Work the problems prior to class. We ll use class time to go over some of the assigned exercises so that we can review the process of working through the problem, discuss any theoretical reasons for the treatment, and review any areas that you struggled with; and (4) Ask questions in class. It s your class. Make the most of it! COMMUNICATION WITH YOUR PROFESSOR: If you have questions about the homework or reading, you may communicate with me in class or during office hours. I will also answer questions related to the material via . If you have an issue that requires me to take some kind of action, you should ALWAYS communicate via . I d prefer if you d me through the Blackboard system (which stamps your with your class section). If you cannot me through Blackboard please remember to include your class section in your correspondence. If you me, I will try to respond in a timely manner. However, as I m sure you are, sometimes I am inundated with . If I do not respond to you in a reasonable amount of time (approximately two business days), please feel free to me again.

7 Blackboard: You are required to check Blackboard on a regular basis. At a minimum, you should check Blackboard prior to coming to class. You are responsible for anything I post on Blackboard, including notes and assignments. All assignments are set up in and should be submitted via Blackboard. All grades are posted on Blackboard. Once a grade is posted, you have one week to dispute it. In order to dispute a recorded grade, you must me. If you have not ed me to tell me that you believe your recorded grade is in error within seven days after the grade is posted, the grade stands. SCHEDULED EXAMS : Exam dates are typically NOT tentative. Rather than change an exam date, I will usually adjust the material on the exam, if necessary. Exams are typically a combination of multiple choice questions, problems, and short answers. You must bring a basic, four-function calculator to the exam if you plan to use a calculator. Calculators may not be shared on exams. Devices that have the capability to store text or communicate with others, including graphic or programmable calculators, pagers, cellular phones, Palms, other PDAs, etc., are not allowed in your possession during exams. You may not use your cell phone as a calculator. You are responsible for all of the material in the assigned chapters, whether or not that material was covered in class. Likewise, you are responsible for any material covered in class that is not presented in the book. On exam days, you should space yourself out so as best as possible to avoid someone being able to copy from your exam. You are responsible for keeping your work covered during the exam. If your exam is visible to your neighbors, I will take it from you and you will receive a zero. PRACTICE GOOD INTERNAL CONTROLS. Take precautions to protect your work. We will generally not have time to review for exams in class prior to the exam (although we should have time to briefly discuss the topics to be covered). Therefore, it is VERY important that you keep up with the material as we go. After the exam, we will spend a short time going over the graded exams and then I will collect them. You will not have any further access to your exams. If you miss the class in which we review the exams and the absence is excused I will review the exam with you in my office. If your absence is unexcused, you will not get the opportunity to review your exam. Following our review, the quiz/exam will be retained in the instructor s office for a minimum of two weeks into the next semester. After that, they will be destroyed according to USF policy. MISSED EXAMS: If you miss an exam, I will assign you a zero. If you have a legitimate excuse for missing the exam, such as illness or a death in the family, I will allow you to make up the exam in a timely manner. I will consider reasons for missing exams on a case-by-case basis. You must provide documentation of your excuse (e.g., doctor s note). If you miss an exam and it is not convenient for me to have you make it up in a timely manner, you will be required to take a comprehensive final. GRADING: points Scheduled exams 150 points each) 600 Your grades will be posted to Blackboard as soon as grading has been completed.

8 RE-GRADE POLICY: If a student disagrees with the grading of any work, a written request for a re-grade must be prepared within one week of the return of the work being disputed. The request must establish the basis for questioning the grade and include appropriate documentation and/or evidence to substantiate the request. Re-grade requests presented after the one week deadline will not be considered. Any re-grade will be a re-grade of the ENTIRE exam or project, not a portion of the exam or project in question. Any or all of the exam or project is subject to change on a re-grade and the student s grade may increase or decrease as a result of the re-grade, i.e. any other grading errors discovered during the re-grade will also be corrected whether those result in an increase or decrease of the student s grade. Certain issues do not require a re-grade request, such as miscalculations by the instructor (or grader) or misgraded automated answer sheets. If in doubt, please see the instructor.

9 Background Information Before you begin Chapter 10, you should refresh yourself on the basics. Please look over Chapter 2 again and go over the assumptions, principles, and constraints as well as the concepts. We will also quickly review these ideas on the first day of class. Date Chapter & Topic Homework Read over the refresher Tuesday, Class Introduction notes found in the May 14 Review of theory Information folder E10-1, E10-7, E10-8, E10-9, E10-3, E10-12, E10-16 (assets 1 Chapter 10: Acquisition and Disposition of PPE May 16 and 2), E10-17, E10-16 (asset 4) P10-9 Chapter 10: Acquisition and Disposition of PPE E10-23 Tuesday, (continued) P10-2 (part a only), P10-4 May 21 Chapter 11: Depreciation, Impairments, and E11-4, E11-6, E11-7, E11-11, Depletion E11-15 Chapter 11: Depreciation, Impairments, and E11-16, E11-18, E11-21, E11-22 May 23 Depletion (continued) P11-3, P11-5, P11-10 Tuesday, May 28 EXAM 1: Chapters 10 and 11 E 12-1, E12-6, E12-9, E12-13 *Chapter 12: Intangible Assets May 30 P12-1, P12-2, P12-3, P12-4 Tuesday, Chapter 12: Intangible Assets (continued) E12-18, E12-19 June 4 Chapter 13: Current Liabilities E13-1, E13-2, E13-5, E13-9 E13-10, E13-11, E13-13, Chapter 13: Current Liabilities (continued) E13-14, E13-15, E13-16, E13-18 June 6 P13-1, P13-4, P13-6, P13-8, P13-10, P13-14 Tuesday, June 11 EXAM 2: Chapters 12 and 13 E14-1, E14-3, E14-4, E14-5, *Chapter 14: Long-term Liabilities E14-6, E14-7, E14-8, E14-11, June 13 E14-13, E14-16 P14-2, P14-5, P14-9 E14-21, E14-22, E14-23, Tuesday, Chapter 14: Long-term Liabilities (continued) E14-24, E14-25 June 18 P14-13

10 E15-2, E15-5, E15-6, E15-7, E15-11, E15-13 Chapter 15: Stockholders Equity June 20 E15-21, E15-22, E15-23 P 15-1, P15-3 Tuesday, E15-19, E15-20 Chapter 15: Stockholders Equity (continued) June 25 P15-12 June 27 EXAM 3: Chapters 14 and 15 Saturday, June 29 Last day to withdraw from class with a W E 16-4, E16-7, E16-8, E16-11, E16-13 Chapter 16: Dilutive Securities and Tuesday, P16-1, 16-4 Earnings Per Share July 2 E16-18, E16-20, E16-25, E16-26, E16-28 P16-8 July 4 Happy Independence Day! E16-29, E16-30 Chapter 16: Dilutive Securities and EPS E17-1, E17-2, E17-3, E17-6, Tuesday, (continued) E17-7, E17-5, E17-10 July 9 *Chapter 17: Investments P17-7 E17-13, E17-16, E17-17, Chapter 17: Investments (continued) July 11 E17-18, E17-19 Tuesday, P17-13, P17-14, P17-15, Chapter 17: Investments (continued) July 16 P17-16, P17-17, P17-18 Exam 4: Chapters 16 and 17 July 18 *Indicates that there is an update to this chapter. Updates may be found in the Information folder.