Financial Accounting - B30000 Autumn 2016 Professor: Mark G. Maffett mark.maffett@chicagobooth.edu Office: HPC 437 (773) 702-9656 Office Hours: By appointment Teaching Assistants: Lisa Liu Matthew O Brien Office Hours: By appointment lisa.liu@chicagobooth.edu matthew.obrien@chicagobooth.edu Admin Assistant: Aleschia Hyde aleschia.hyde@chicagobooth.edu Class Times and Locations: Section 03: Wednesday 1:30 pm 4:30 pm Harper Lecture Hall C09 Section 04: Tuesday 1:30 pm 4:30 pm Harper Lecture Hall C09 Section 82: Tuesday 6:00 pm 9:00 pm Gleacher Lecture Hall 300 Review sessions (optional): All Sections: Midterm Review: Tuesday, October 25 th 9:00 pm 10:00 pm Gleacher Lecture Hall TBD Monday, October 31 st 11:45 am 12:45 pm Harper Lecture Hall TBD All Sections: Final Review: Tuesday, November 29 th 9:00 pm 10:00 pm Gleacher Lecture Hall TBD Wednesday, November 30 th 5:00 pm 6:00 pm Harper Lecture Hall TBD Course Description: In this course, we will examine fundamental accounting concepts and principles. The course is intended to provide you with the basic skills necessary to understand and analyze financial statements as well as to prepare you for more advanced financial statement analysis courses. The objective is not to train you as an accountant but rather to help you become an informed user of financial statements. Classes will include interactive lectures and discussions about financial accounting principles and practices. Short cases involving corporate financial statements will also be used to illustrate accounting concepts and to explore the disclosure strategies of companies. Some attention will be paid to international differences in reporting practices and how such differences affect financial statement users. Required course materials: You are required to purchase the textbook, which has been customized specifically for this course. The textbook can be purchased directly from McGraw-Hill or from the bookstore. There are two options: (1) Hardcopy: The hardcopy textbook can be purchased though the following link: http://shop.mheducation.com/mhshop/productdetails?isbn=126005148x. The hardcopy textbook package includes: both the customized hard and electronic versions (ebook) of 9 th Edition of Financial Accounting by Libby, Libby, Hodge (published by McGraw- 1
Hill, ISBN# 126005148X); and Access to the McGraw-Hill Connect Assignment System ( Connect ). (2) Electronic: Includes an ebook copy of the text as well as access to Connect. You can purchase the ebook directly from the Connect website accessed through Chalk. After purchasing the text, you are required to register on the Connect website. To do so, access the Connect system through Chalk (log in to chalk.uchicago.edu, click on Homework Assignments, Week1, Graded Homework-Chapter 1, and Register ; enter your email and the Access Code that accompanied the textbook). Note: If you are not sure whether you will ultimately enroll in the course, McGraw-Hill offers a threeweek free trial of the electronic version of the text, which is also available via the Connect registration page. Examinations: The mid-quarter exam will take 1 hour and 30 minutes and will be held in class in Week 6, as follows: Section 03: Wednesday, November 2 nd 1:30 3:00 pm Section 04: Tuesday, November 1 st 1:30 3:00 pm Section 82: Tuesday, November 1 st 6:00 8:30 pm The final exam is three hours in length and will be comprehensive of all course topics and materials. The final exam schedule is as follows: Section 03: Wednesday, December 7 th 1:30 4:30 pm Section 04: Tuesday, December 6 th 1:30 4:30 pm Section 82: Tuesday, December 6 th 6:00 9:00 pm Both examinations will be "closed book/closed notes" you are not allowed to bring class material to the exam. You will find it useful to bring a calculator to the exams. I do not return final exams, although students can arrange a time to come to my office and go over the exam. Please have your name card displayed during the examinations. Note: There will be no changes to the final exam schedule set by Booth. Check your schedules carefully if you cannot attend the final exam at its scheduled time then do not enroll in this section. Make-up exams are not possible. Course Website: I will use two electronic resources for this course: (1) the University s Chalk system (http://chalk.uchicago.edu) which contains course announcements, class handouts, slides, cases, and articles; (2) the McGraw-Hill Connect website which contains homework assignments and access to the ebook (accessible directly through Chalk). Please ensure that you are able to access the system as soon as possible. Grading: The following weights will be used in calculating final grades: Graded Online Homework 10% Case Presentation 10% Case Solutions 10% Class Participation 10% Mid-quarter Exam 20% Final Exam 40% 100% If your final exam score is higher than your mid-term score, the mid-term score will be replaced by the score on the final exam. In such cases, the final exam is worth 60% of your final grade. Requests to 2
regrade the midterm exam must be made in writing within one week of the return of the exam. Regrade requests for the mid-term and the final will result in the entire exam being regraded and may result in a higher or lower grade. Note: Students needing a provisional grade in order to graduate must have a midterm score. Graded Homework (McGraw-Hill Connect available through Chalk): Several homework problems are assigned for each chapter. Complete the assigned problems on the Connect website accessed directly through Chalk. You can check your work on Connect before you submit it (Connect will tell you whether your answers are correct or incorrect as you work through each problem). You have three opportunities to submit the correct response before incorrect responses are counted against you. Connect provides an assignment score and a comprehensive correct solution immediately following the due date. Assignment due dates are posted on the McGraw-Hill Connect website and on the Course Schedule below (the first graded homework assignment is due in Week 2). The graded assignments will count 10% toward your final score. Assignments submitted late will not be considered. Homework is due at 11:00 p.m. on the Monday following class discussion of the related textbook chapter. You may skip one of the graded homework assignments (there are 9 graded assignments and 1 optional assignment on Connect and your grade will be based on 8 of the 9 graded assignments. I will leave out the assignment with the lowest (or no) grade.) Collaboration: Collaboration with classmates on homework is allowed and encouraged. However, submitted solutions should be your own work. If you are working on homework with several of your classmates, you will notice that correct answers for your assignment will often differ from correct answers of your classmates assignments. Backup Homework Submission: Each McGraw-Hill Connect assignment is derived from related exercises and problems in the Libby, Libby, and Short textbook. The textbook version of those exercises and problems are listed on the last page of the syllabus. If you are not able to access McGraw-Hill Connect for any reason (e.g., traveling without an internet connection), you can work the related problems from the textbook and e-mail your solution to the TA before the deadline. Pre-Class Preparation: You are required to read the assigned chapters before the class (it is preferable that you begin work on the assigned homework prior to the class). LearnSmart on McGraw-Hill Connect: There is a short LearnSmart self-study module for each textbook chapter. Each module is a game-like short quiz designed to test your understanding of material from the assigned textbook chapter. It is optional whether you want to use LearnSmart. Cases: I will assign/cover 7 cases throughout the quarter (six of which must be handed in prior to the beginning of class on the day they are scheduled to be discussed). These cases are intended to enhance your understanding of real world companies financial statements and transactions. In keeping with the complexity of real world accounting issues, the material in the cases may be somewhat more challenging than the textbook homework problems. Accordingly, grading of the cases will be based on the effort expended in understanding the situation presented and an attempt to provide a thoughtful response to the questions posed. Rather than seeking to arrive at an exact correct answer, your goals for each case should be to make a good faith attempt at understanding and answering each question and to come to class prepared to contribute to an intelligent discussion of the issues presented. Requirements: You are expected to work in teams on all 7 cases and are required to fulfill the following: 3
1. In-Class Case Assignment (Presentation): The class will be evenly divided in 7 Case Teams. Each team is required to present and discuss a solution to one of seven cases. Presentations will take place during the class in Weeks 3 to 9. You are to include the following information on the front page: your section #, your group #, first and last names of all members that contributed. 2. Weekly Case Homework: Complete and submit a group solution to any 6 out of 7 cases and participate in the class discussion of cases. The answers to the case questions are due at the beginning of the class where the case is discussed (see the course schedule below). Additional instructions regarding case-based homework are provided in a separate document on Chalk. Classroom performance/contribution: Display your name card in every class (make one if you do not have it). Class participation is based on your contribution to class discussions, preparation for class (e.g., readings, cases), and class attendance (your score is based on your contribution, not the amount of time you talk). It is taken into account that students with different backgrounds contribute differently. Cold calls are not uncommon. In the rare instance that an emergency precludes you from preparing for a particular class, you should notify the instructor before the class begins. Tardiness and entering or leaving during class or lack of attendance may have a negative effect on your classroom performance grade. If you come unprepared you need to communicate this to the instructor. Review Sessions: If you have questions about class material, self-study problems or your readings, please make use of the review sessions. Attendance at review sessions is optional, but is recommended if you have questions about the material or homework. If you want to go through specific exercises during the review session, please indicate this to me via email him in advance. Help With Your Questions & Office Hours: E-mail is a convenient way to ask questions. Please direct your (content related) questions to the teaching assistant (you can CC me) and allow for some time before he answers. If you have organizational questions, please email me directly. Instead of holding inflexible office hours, I am available by appointment to answer questions or address problems. I will also be available a few minutes before and after class to answer brief questions. Honor Code: Students are required to adhere to the standards of conduct in the Chicago Booth Honor Code and the Standards of Scholarship (see the Student Handbook: Regulations, Policies, and Procedures for more information). Any communication among students during the exam is strictly forbidden. Students are not permitted to discuss any part of an exam (including both questions and answers) with other students until the exam has been taken by all the sections of this course (including other instructors). Class Courtesy: Students are expected to be in their seats with their cell-phones turned off prior to the start of class. Laptop computers are allowed in class to take notes or read class related materials. Browsing the internet and other non-class related activities are not allowed. Such activities during the class distract other students. How to do well in this course: Expect to spend between 5-8 hours per week on the course outside of class. Come prepared to each class (have your name tag displayed). Read the solutions to online homework and Cases. Prepare for In-Class Assignment/Presentation/Discussion in advance Take the practice exams. 4
Talk to me or the TA if you have questions. Accommodations: If you require any accommodations for this course, as soon as possible please provide your instructor with a copy of your Accommodation Determination Letter (provided to you by the Student Disability Services office) so that you may discuss with him/her how your accommodations may be implemented in this course. The University of Chicago is committed to ensuring the full participation of all students in its programs. If you have a documented disability (or think you may have a disability) and, as a result, need a reasonable accommodation to participate in class, complete course requirements, or benefit from the University's programs or services, you are encouraged to contact Student Disability Services as soon as possible. To receive reasonable accommodation, you must be appropriately registered with Student Disability Services. Please contact the office at 773-702- 6000/TTY 773-795-1186 or disabilities@uchicago.edu, or visit the website at disabilities.uchicago.edu. Student Disability Services is located at 5501 S. Ellis Avenue. 5
Course Schedule: Week 1 9/27 & 9/28 Week 2 10/4 & 10/5 Week 3 10/11 & 10/12 Week 4 10/18 & 10/19 Week 5 10/25 & 10/26 Week 6 11/1 & 11/2 Week 7 11/8 & 11/9 Week 8 11/15 & 11/16 Week 9 11/22 & 11/23 Week 10 11/29 & 11/30 Assignments: Assignments: Case 1: Case 2: Case 3: Exam: Case 4: Case 5: Case 6: Case 7: Introduction to Accounting and the Statement of Financial Position Chapter 1, Chapter 2, skim Chapter 5 (pages 227-238) HBS Case: Berkshire Hathaway ; Skim the Berkshire 2014 annual report Homework #1 - M1-1, M1-2, E1-3, E1-4, E1-5 (part 2), E1-9 October 3 rd, 2016 Understanding the Income Statement and Adjusting Entries Chapter 2, Chapter 3, Chapter 4 Homework #2 - E2-5, P2-5, P3-4 (parts 1, 2, and 3), M4-12, E4-8 October 10 th, 2016 Statement of Cash Flows Chapter 12 Netflix: Fundamentals of the B/S and I/S Homework #3 - E12-8, E12-18, E12-21 October 17 th, 2016 Reporting and Interpreting Revenue and Accounts Receivable Chapter 6 Groupon: Constructing Projected Financial Statements Homework #4 - E6-2, E6-10, E6-5, E6-14, P6-2 (part 1), E6-11 October 24 th, 2016 Interpreting Cost of Goods Sold and Inventories Chapter 7 Apple: Understanding the Effects of Revenue Recognition Homework #5 - E7-2, P7-2, P7-10 October 31 st, 2016 Midterm examination (closed book, closed notes) Long-lived assets Chapter 8 Exxon vs. Shell: Understanding the effects of Inventory Valuation Homework #6 - M8-7, M8-8, M8-9, E8-15, E8-18 November 7 th, 2016 Liabilities, contingencies, & long-term debt Chapter 9, Chapter 10 Intel Corp: Accounting for R&D Homework #7-E9-1, E9-4, P9-1, E10-8, E10-17, P10-10 November 14 th, 2016 Long-term debt (cont.), Leases, & Deferred Taxes Chapter 10, Leases & Deferred Taxes Supplement BP: Accounting for the Gulf of Mexico Spill Homework #8 - SE-5, SE-6, SE-7, SP-1, SP-2, SP-3 November 21 st, 2016 Investments Appendix A Kohl s: The effects of Operating vs. Capital Leases Homework #9 - EA-1, PA-5, PA-7 (parts 1, 2, and 3), PA-8 November 28th, 2016 Shareholders equity & comprehensive review Chapter 11 Optional Homework #10 - M11-6, M11-7, M11-8, E11-7, E11-9 6