ACC 291 Week 5 Learning Team Reflection Summary
ACC 291 Week 5 Learning Team Reflection Summary
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Date Created: 11/11/15
Learning Week Five Re ection Summary University of Phoenix Principles of Accounting 11 ACC 291 Learning Team C Week Five Re ection Summary Learning Team C agree that Weeks Four and Five were much easier to understand as the accounting concepts were explained and applications started feeding into each other Here are some of the things the team learned on the objectives listed 0 Prepare a statement of cash ows using both direct and indirect methods 0 Direct and indirect for statement of cash ows can be tricky learning team c finds the direct method to be easier to understand and use than the indirect method The team thinks that the direct method makes more sense because there are fewer variables or categories Regardless the team believes the statement of cash ows to be interesting and with a little bit of onthejob experience more understandable 0 Apply ratio vertical and horizontal analysis to financial statements 0 The team agrees that the vertical and horizontal analysis is fairly straightforward and easy to complete and understand The ratio analysis is a bit more difficult yet understandable Developing the necessary knowledge to understand each analysis process is important As an accountant deciding upon which way the analysis is to be prepared will greatly depend upon who the target audience will be Each of these processes provides knowledge in its own right 0 Horizontal Analysis example M5915 ELI rren t 355E151 Property FBIant and equipment net lntanibleg Natal 355E115 LiabilitiEi i and Etmlth lrdem euityr ELI rrent liailitiEE Leonterm Iia bilitiE Etoclth ldem er uiw Natal liabilitierg and Et hh l er n equity 0 Vertical Analysis example mm Eurrent 355E115 Property pla t and equipment net lnta ngiIEE 39m39 tal 353E115 Lia bilitiEE a at Stockholder equ iw Eurrent Iia bilititEfi i Long term liabilitiEE Stockholder5 equity 39m39 tal liailitiEE an Stockholder5 Enquinr 3111 WHITEBEE m BEETE39EIHE39 dlmri ng Mm wnit quotit TM j j 11m 21G 1 mama 1 lama 1 mm ll i 1 animal 3111 quot 5quotEJ 315 413 411555 411 413355 lm lllnlt Ferment Hm wnjt Percent FIJIH ETJHJ Elill39 r 1191535 33155 1519155 1 11 ELSE Ti l 21G 129 ILEIEE 5 551 21111 0 Prepared journal entries associated With the issuance of preferred and common stocks and the declaration and payment of dividends 0 Stocks are still something that the team is working on Some on the team have grasped the concept Without a problem While others are still working on these concepts The team agrees that the further the material goes the easier Journal Entries are to understand Just make sure to know which account to credit and which account to debit O Issuance of preferred stock journal entry I Credit Cash I Debit Preferred Stock and PaidIn Capital 0 Issuance of common stocks journal entry I Credit Cash Organizational Expense or Land I Debit Common Stock and PaidIn Capital 0 Declaration of dividends journal entry I Credit Cash Dividends I Debit Dividends Payable 0 Payment of dividends journal entry I Credit Dividends Payable I Debit Cash 0 Identify situations that might lead to unethical accounting practices 0 One of the most common reasons seems to be greed An accountant who wants money will embezzle it from the company or a CEO who wants his stock portfolio to make more money so he makes the company seem stronger than it is Other situations include accountant in uenced by their bosses to quotcook the booksquot so the company can look financially stable even when it is not Another situation that seems to be overlooked is not malice but the fact that the accountant simply lazy The accountant may not be paying as much attention as he or she should and the result is missing entries that should have been caught These situations and many more can easily lead to unethical accounting practices 0 A situation that can lead to unethical practices in accounting is not following the GAAP principles and the matching principles For example if a company is having slow sales in the first quarter of their financial period and they receive a check for services that will be done the following year If the company recognizes the revenue immediately to make up for some of the losses they are having This is an unethical practice the income has not yet been earned and can only be recognized in the period Where the services are arendered 0 Examine the effect of unethical behavior and the SarbanesOxley SOX Act on financial statements 0 The Act requires all financial reports to include an internal control report This is designed to show that not only are the company39s financial data accurate but also the company has confidence in them because adequate controls are in place to safeguard financial data Yearend financial reports must contain an assessment of the effectiveness of the internal controls The issuer39s auditing firm is required to attest to that assessment after reviewing controls policies and procedures 0 An example given by a team member is that even though the CFO is responsible trouble rolls downhill and many accountants are at the bottom of that hill Each accountant must ensure that their part of the financial reporting that goes into the financial statements is accurate and truthful References Weygandt J J Kimmel P D amp Kieso D E 2010 Financial accounting 7th ed Hoboken NJ John Wiley amp Sons ACC 291
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