Active Outline

General Information

Course ID (CB01A and CB01B)
ACCT D052.
Course Title (CB02)
Advanced Accounting
Course Credit Status
Credit - Degree Applicable
Effective Term
Fall 2024
Course Description
The course presents financial accounting theories and practices related to business combinations and consolidated financial reporting. This includes the development of complex business structures and forms of business combinations; consolidated financial reporting for intercorporate acquisitions and operations; and the accounting for transactions of affiliated companies. Also includes accounting and reporting issues in the governmental and not-for-profit environment. Accounting theory and practice related to the formation, operation, and liquidation of partnerships are covered.
Faculty Requirements
Discipline 1
[Accounting]
FSA
[FHDA FSA - ACCOUNTING]
Course Family
Not Applicable

Course Justification

This course is a CSU transferable undergraduate course intended to help meet the requirements of the Accounting: Certificate of Achievement-Advanced. This course covers financial accounting topics traditionally presented at the end of an accounting program including business combinations, governmental and not-for-profit accounting, and partnerships.

Foothill Equivalency

Does the course have a Foothill equivalent?
No
Foothill Course ID

Course Philosophy

Formerly Statement

Course Development Options

Basic Skill Status (CB08)
Course is not a basic skills course.
Grade Options
  • Letter Grade
  • Pass/No Pass
Repeat Limit
0

Transferability & Gen. Ed. Options

Transferability
Transferable to CSU only

Units and Hours

Summary

Minimum Credit Units
5.0
Maximum Credit Units
5.0

Weekly Student Hours

TypeIn ClassOut of Class
Lecture Hours5.010.0
Laboratory Hours0.00.0

Course Student Hours

Course Duration (Weeks)
12.0
Hours per unit divisor
36.0
Course In-Class (Contact) Hours
Lecture
60.0
Laboratory
0.0
Total
60.0
Course Out-of-Class Hours
Lecture
120.0
Laboratory
0.0
NA
0.0
Total
120.0

Prerequisite(s)

ACCT D001B or ACCT D01BH

Corequisite(s)

Advisory(ies)

ACCT D051B

Limitation(s) on Enrollment

Entrance Skill(s)

General Course Statement(s)

Methods of Instruction

Lecture and visual aids

Discussion of assigned reading

In-class discussion and problem-solving

In-class quiz and examination review

Homework and extended projects

Collaborative projects and small group exercises

Assignments

  1. Participate in interactive class cases.
  2. Read required text assignments and various recommended articles.
  3. Complete various homework assignments including accounting problems, journal entries, consolidation workpapers and financial statements.
  4. Prepare directed term paper and/or individual student presentation.

Methods of Evaluation

  1. Interactive class cases designed to demonstrate effective team participation and group problem solving skills.
  2. Homework problems designed to demonstrate critical thinking and problem solving skills related to course material.
  3. Directed term papers and/or individual student presentations demonstrating the ability to relate course concepts to current events in the business world.
  4. Midterm and final examination requiring students to demonstrate abilities to summarize, integrate, and analyze concepts that have been introduced and studied throughout the course.

Essential Student Materials/Essential College Facilities

Essential Student Materials: 
  • None
Essential College Facilities:
  • None

Examples of Primary Texts and References

AuthorTitlePublisherDate/EditionISBN
Theodore Christensen, David Cottrell and Cassy BuddAdvanced Financial AccountingNew York, NY:McGraw-Hill Companies, Inc.2023/13th Edition

Examples of Supporting Texts and References

None.

Learning Outcomes and Objectives

Course Objectives

  • Define, describe and compare forms of business combinations.
  • Define, compare, and differentiate forms of accounting for business combinations.
  • Describe, distinguish and assess methods of accounting for investments in common stock, including the cost and equity methods.
  • Recognize and evaluate the advantages and limitations of consolidated financial statements.
  • Examine and compare traditional concepts of corporate control with changing definitions of the financial reporting entity.
  • Define and examine the consolidation process.
  • Prepare elimination entries, consolidation worksheets and financial statements at the point of acquisition of a corporate subsidiary.
  • Prepare elimination entries, consolidation worksheets and financial statements for ongoing operations of affiliated companies.
  • Analyze, calculate, and assess the impact of the transfer of inventory between affiliated parties.
  • Define, examine, and evaluate governmental accounting issues and demonstrate a knowledge of governmental accounting by preparing journal entries and financial statements.
  • Define, examine, and evaluate not-for-profit accounting issues and demonstrate a knowledge of governmental accounting by preparing journal entries and financial statements.
  • Define, describe and compare accounting methods for partnership formation, operation, and liquidation.

CSLOs

  • Demonstrate knowledge of business combinations; prepare, explain and analyze consolidating workpapers and financial statements.

  • Demonstrate knowledge of governmental, not-for-profit, and partnership accounting; and demonstrate an ability to properly record related transactions and prepare related financial statements.

Outline

  1. Define, describe and compare forms of business combinations.
    1. Reasons for and methods of business combinations
    2. Definitions of consolidated entity and discussion of Special Purposes Entities (SPE's).
    3. Purchase versus Pooling of Interest accounting approaches
  2. Define, compare, and differentiate forms of accounting for business combinations.
    1. Determination of purchase price
    2. Purchase of net assets
    3. Purchase of common stock
    4. Goodwill
  3. Describe, distinguish and assess methods of accounting for investments in common stock, including the cost and equity methods.
    1. Cost method
    2. Equity method
    3. Amortization of differential under equity method
  4. Recognize and evaluate the advantages and limitations of consolidated financial statements.
    1. Long term investor, long term creditor, and short term creditor perspectives
    2. Advantages such as ability to evaluate total resources of consolidated entity
    3. Disadvantages such as information loss due to aggregation of data
  5. Examine and compare traditional concepts of corporate control with changing definitions of the financial reporting entity.
    1. FASB Statement 94 rules regarding consolidation of majority owned subsidiaries.
    2. Direct and indirect control
    3. Recent developments regarding Special Purpose Entities and Variable Interest Entities
  6. Define and examine the consolidation process.
    1. Intercorporate stockholdings
    2. Intercompany receivables and payables
    3. Intercompany sales
    4. Minority interest
    5. Proprietary theory, parent company theory, and entity theory
    6. Definition of consolidated net income and consolidated retained earnings
  7. Prepare elimination entries, consolidation worksheets and financial statements at the point of acquisition of a corporate subsidiary.
    1. One hundred percent ownership at book value
    2. One hundred percent ownership at more than book value - differential and goodwill
    3. One hundred percent ownership at less than book value
    4. Less than 100% ownership at book value - minority interest
    5. Less than 100% ownership at other than book value - minority interest
  8. Prepare elimination entries, consolidation worksheets and financial statements for ongoing operations of affiliated companies.
    1. One hundred percent ownership at book value - first and subsequent years
    2. Less than 100% ownership at book value - first and subsequent years
    3. Less than 100% ownership at more than book value - first and subsequent years
  9. Analyze, calculate, and assess the impact of the transfer of inventory between affiliated parties.
    1. Elimination of intercorporate transfers and unrealized profits and losses
    2. Upstream sale of inventory
    3. Downstream sale of inventory
  10. Define, examine, and evaluate governmental accounting issues and demonstrate a knowledge of governmental accounting by preparing journal entries and financial statements.
    1. Understand and explain the basic differences between governmental and private sector accounting.
    2. Understand and explain the differences between the various governmental fund types.
    3. Understand and explain basic concepts for financial reporting in governmental accounting.
    4. Understand and explain basic budgeting concepts in governmental accounting.
    5. Make calculations, record journal entries, and prepare financial statements for governmental funds, including the general fund; enterprise and fiduciary funds; and prepare government-wide financial statements.
  11. Define, examine, and evaluate not-for-profit accounting issues and demonstrate a knowledge of governmental accounting by preparing journal entries and financial statements.
    1. Understand financial reporting rules, make basic journal entries, and prepare basic financial statements for private, not-for-profit entities.
    2. Understand financial reporting rules, make basic journal entries, and prepare basic financial statements for not-for-profit colleges and universities.
    3. Understand financial reporting rules, make basic journal entries, and prepare basic financial statements for not-for-profit health care providers.
    4. Understand financial reporting rules, make basic journal entries, and prepare basic financial statements for other not-for-profit organizations, including voluntary health and welfare organizations.
  12. Define, describe and compare accounting methods for partnership formation, operation, and liquidation.
    1. Nature of partnership entity
    2. Partnership formation
    3. Partnership operation
    4. Allocation of profit and loss
    5. Changes in membership
    6. Lump-sum liquidation
    7. Installment liquidation
    8. Partnership financial statements
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