1. Accounting 211 Financial and Managerial Accounting Teaching Assistant Hyun Jung (Joan) Lee

2. Spring, 2008 1 Contents 1. Introduction Let me INTRODUCE~ Course Introduction Textbook Evaluations Makeup Exam WileyPlus 2. Review of Chapter2 3. Practice

3. Introduction 1

4. Spring, 2008 3 Hyun Jung (Joan) Lee, 1 st year Accounting Ph.D. student Background B.S. in Statistics M.B.A. in Finance Korean Institute of Certified Public Accountants Korean Institute of Certified Tax Accountants Senior Associate, PricewaterhouseCoopers (PwC), 2001-2006 Office : 381A Business Building, 814-863-3796 Office Hour : 8 AM. ~ 10:00 AM on Tuesday Email : hul152@psu.edu Personal Blog : www.personal.psu.edu/hul152 Let me INTRODUCE~

5. Spring, 2008 4 In-Class Lecture Face-to-face meeting with instructor Section 04 : T R 08:00A - 09:15A, 105 FORUM Section 11 : T R 02:30P - 03:45P, 105 FORUM Section 17 : T R 04:15P - 05:30P, 105 FORUM Lab  Recitation Course Introduction Lecture

6. Spring, 2008 5 Recitation with “ME” on FRIDAY!! Section 04 : F 2:30-3:45PM, 106 Business Section 11 : F 8:00-9:15AM, 106 Business Section 17 : F 09:45-11:30AM, 362 WILLARD (Note: If you miss the assigned recitation, you can attend any other two recitations) (Note: If you miss the assigned recitation, you can attend any other two recitations) Course Introduction, cont. Recitation

7. Spring, 2008 6 Textbook Accounting, 2nd ed. with WileyPLUS by Paul Kimmel et al. Accounting, 2nd ed. with WileyPLUS by Paul Kimmel et al. Three options as to type of book to purchase: Three options as to type of book to purchase: (a) to buy a standard book (a) to buy a standard book (b) to buy a binder ready version of the book (b) to buy a binder ready version of the book (c) an electronic copy of the book (c) an electronic copy of the book (everything in the book is in this version). (everything in the book is in this version). Have Fun!!~ Sample Quizzes, Crossword Puzzles and Electronic Flash Cards and some interactive tutorials Sample Quizzes, Crossword Puzzles and Electronic Flash Cards and some interactive tutorials Textbook

8. Spring, 2008 7 Grading components Professor Ketz : Financial Accounting Professor Huddart : Managerial Accounting Number Grade = 2/3 * Financial Acc. +1/3*Managerial Acc. Financial Accounting Homework : WileyPlus Exam 1 : Feb 13, 8:15 to 10:00 PM. Exam 2 : Mar 26, 8:15 to 10:00 PM. Each components weighted one-third Evaluation

9. Spring, 2008 8 Ask “W.G. Deng” for PERMISSION Contact Information Office : 350A Business Building Phone : 863-5467 Email : wxd139@psu.edu Office Hours : Mon & Thrs from 1pm until 3pm and by appointment. Only one chance to take it Makeup for the First Exam : Feb 23th on Saturday Makeup for the Second Exam : April 5th on Saturday Make-up Exam Assignments

10. Spring, 2008 9 For Registering http://www.wiley.com/college/twomin/stu/register.html http://www.wiley.com/college/twomin/stu/register.html The URL : http://edugen.wiley.com/edugen/class/cls49425/ WileyPlus Online Homework

11. Review of Chapter2 2

12. Spring, 2008 11 Balance Sheet Income Statement Statement of Changes in Owners’ Equity Statement of Cash Flows Solving Approach by transaction perspective Income Statement Statement of Changes in Owners’ Equity Balance Sheet Statement of Cash Flow Financial Statements Overview

13. Spring, 2008 12 Balance Sheet Describe the financial situation of a specific point in time Describe the financial situation of a specific point in time Accounting Equation Assets = Liabilities + Owner’s Equity Components Assets : Economic resources owned by the business Assets : Economic resources owned by the business Liabilities : Obligations of the business to creditors Liabilities : Obligations of the business to creditors Equity : Owner’s claims to the assets of the company Equity : Owner’s claims to the assets of the company  Contributed capital & Retained earnings Retained Earnings (R/E) Retained Earnings (R/E) End of R/E = Beginning R/E + Net Income – Dividends Financial Statements Balance Sheet

14. Spring, 2008 13 Income Statement Show all revenues minus all expenses for an accounting period Show all revenues minus all expenses for an accounting period Statement of changes in Owners’ Equity Show the changes that took place in the amount of owners’ equity during the period Show the changes that took place in the amount of owners’ equity during the period End of Contributed Capital (C/C) + End of Retained Earnings End of Contributed Capital (C/C) + End of Retained Earnings End of C/C = Beginning of C/C + Stock Issued during that period End of C/C = Beginning of C/C + Stock Issued during that period End of R/E = Beginning R/E + Net Income – Dividends Financial Statements, conti.

15. Spring, 2008 14 Statement of Cash Flows Show all the cash inflows and all the cash outflows for a specific period with the revenues and expenses for the same period in the income statement Three Sections Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Check the below two amounts are EQUAL!!! End of Cash Amounts in Statement of Cash Flows Cash Amounts in Balance Sheet Financial Statements, conti. Statement of C/F

16. Spring, 2008 15 Liquidity Can a company pay the bills as they come due? Solvency Can the company survive over a long period of time? Profitability Can a company earn a satisfactory rate of return? Market indicators Is the stock a good investment? Cash Flow: pretty obvious after March 18th Ratio Classification

17. Spring, 2008 16 15 Ratios

18. Spring, 2008 17 15 Ratios, conti.

19. 3 Practice!!!

20. Spring, 2008 19 Problem 2 Problem 7 Practice

21. Spring, 2008 20 Do you have any questions? Welcome to Accounting World!!~ 381A Business Building 814-863-3796, hul152@psu.edu