Encouraging participation in research: results from two consecutive semesters

The accountancy department at the Gies College of Business encourages professors to offer extra credit for students who participate in accountancy research. The policy is to award up to 1% extra credit for participation. Each study is worth 0.5%, and students may participate in up to two studies per course. My courses are worth up […]

I like the OCI statement

“Learn the rules like a pro, so you can break them like an artist.” Pablo Picasso There are five main financial statements in financial accounting: Balance sheet Income statement Statement of cash flows Statement of stockholder’s equity Statement of comprehensive income The first three have a special emphasis in the intermediate accounting textbook that we […]

Proportional allocation worksheet for asset purchases in Intermediate Accounting

I created the following worksheet to help students learn how to proportionally allocate the purchase price of a group of assets. It works for concepts in the Intermediate Accounting textbook we use by David Spiceland, et al: In Chapter 6, we learn about the five steps of revenue recognition. We must find or calculate the […]

Sales returns: Gross Profit, Refund Liability, Inventory Estimated Returns

To understand sales returns and the unique accounts that are used for them (Refund liability and Inventory estimated returns), let’s start by reviewing the journal entry for the sale of goods. It raises gross profit (in green) by taking this form: A/R (or cash) $Retail Sales revenue $Retail COGS $Cost Inventory $Cost Now let’s look […]

Earnings per share: numerator and denominator summary table

Below is a table I made to summarize what happens to the numerator and denominator for EPS calculations for each kind of relevant transaction. I can see this being helpful for CPA exam preparation, as well as for students of Intermediate Accounting. I include information regarding: Net income Preferred stock dividends: cumulative and noncumulative, convertible […]

Debits and credits: different parts of speech

How about some light-hearted fare today? The words “debits” and “credits” can be used in many different parts of speech. Here is a table I created with examples using “debit.” Part of Speech Example Noun (subject) The debit raised the balance in the cash account. Noun (object) The liability account needs more debits. Noun (object […]

Revenue Recognition: When Progress Billings is more than Construction in Progress

One of the ways that I like to supplement the Spiceland Intermediate Accounting textbook is to create financial statements from the journal entries in the lessons. Generally, the textbook shows the journal entry that is used for the transaction, but it sometimes does not show what happens to the balance sheet after the journal entry […]

Realized and unrealized gains and losses on the income statement vs OCI statement

Here is a table I made to show students where realized and unrealized gains and losses are reported. This table could be used when teaching the following chapters in the Spiceland Intermediate Accounting textbook (10th edition): Chapter 4: the Income Statement, Comprehensive Income, and the Statement of Cash Flows Chapter 12: Investments Chapter 17: Pensions […]

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