Ac 2012 Ar Appendix A Ex5

Appendix A, Exhibit 5: BSBA Goals Assessed in Accounting based on Spring 2011 Data
Department: Accounting
Goal: BSBA-1-Accounting - Mastery of Business Knowledge: Each
functional area (Accounting, Finance, Law, Management, Marketing and MIS)
identifies the performance objectives of its respective discipline.
Section One Learning Outcome and Numeric Result.
Learning Outcomes
Course(s)
Where
Measured
Number
Of
Students
Measured
Number
Of
Sections
Measured
Number of
Students
Above
Acceptable
Number of
Students
Acceptable
Number of
Students
Below
Acceptable`
1) Apply business research skills
AC211
241
68 (28%)
137 (57%)
36 (15%)
_________________________________________________________________________
Section Two Findings
The financial statement analysis project is used to assess each students
analytical skills, critical thinking and team-building skills. Each student was
assigned to analyze the financial statements of a company. Each individual
professor selected different companies so that students in different sections
would not be working together and/or copying each others work. After
calculating and interpreting the financial ratios, they were asked if they
would invest and lend to the company they were analyzing. Each class was
assigned five to six companies to analyze. The project included industry
ratios provided by the professor.
Due to a misunderstanding, the accounting department had assumed that
the BSBA data collection was being collected in the Fall Semester and the
Major level data collection was being collected in the Spring semester. By
the time the department became aware that the School wanted BSBA level
data for Goal 1 for the Spring 2010 semester as well as for the Fall 2009
semester, some of the assignments that we use for assessment had already
been completed, graded and returned to the students. We were unable to
provide assess learning outcome one for the Spring 2010 semester.
As noted in the table above 85% of the students performed at an acceptable
level or above in Spring 2011. The results were almost identical to what we
found in In Fall 2009. Bothe Spring 2011 and Fall 2009 represented a slight
improvement over the Spring 2009 semester results when, 81% of the
students responses were acceptable or above. The students rated above
acceptable were 28% in Spring 2011, up from 21% in Spring 2009.
Section Three Analysis
Performance on this learning objective exceeds our goal of at least 75%
performing at an acceptable level or better. The improved performance of
Fall 2009 over Spring 2009 was sustained in Spring 2011, but performance
has leveled off. We instituted a pre-semester co-ordination meeting and also
discussed course challenges and shared ideas. This did not result in
measurable improvement on this learning goal over Fall 2009.
Section Four Use of Results
The performance of students on this learning goal is stable at a reasonably
high level, exceeding our target for this learning goal. We are currently
devoting our improvement efforts to other learning goals where performance
is poorer.
Action items:
1. No new action items on this goal.
Appendix
Assessment instrument: AC 211 Introduction to Financial
Accounting Spring 2011
FINANCIAL REPORTING & ANALYSIS TEAM PROJECT
(The individual portion of the project is used for assessing learning
objective 1)
AC 211 - FINANCIAL REPORTING & ANALYSIS TEAM PROJECT Spring 2011
READ ALL INSTRUCTIONS BEFORE YOU BEGIN
Individual Report (Due: Week 10)
Each person will be assigned a company at the beginning of the semester. You
should acquire the company's 10-K at the EDGAR link at the SEC website
(www.sec.gov). You should write a short report answering the following questions
about the assigned company. For this project, refer to your book especially
Chapters 5 and 13.
IF YOU MUST REPORT A RATIO, A PERCENTAGE, OR ANSWER IF THERE HAS BEEN A
CHANGE, YOU MUST SHOW CALCULATIONS. Please note that this is individual
work, any indication of copying or plagiarism would result in a zero for this project
and subject to the Academic Honesty Policy guidelines. Refer to Chapters 5 and 13.
1.
General information:
1. Where is the corporate headquarters, what city and state? Where did
you find this information?
2. On what day of the year does its fiscal year end? Where did you find
this information?
2.
3.
4.
5.
6.
3. What types of products or services does it sell/serve? Where did you

find this information?
4. When and where is the next annual stockholders meeting? Where did
you get this information?
Report of Independent External Auditor
1. Who is the corporations independent auditor and in what city are they
located?
2. Does the auditor believe the financial statements were presented
fairly? What statements in the auditors opinion support your
conclusion?
For how many years does it present complete balance sheets? Income
statements? Cash flow statements?
Income Statement
1. Did its revenue (or sales) increase or decrease over the last year?
What was the percentage change?
2. ((this year-last year)/last year)
3. Describe the company's revenue recognition policy. Where did you
find this? What are you some factors that the company used in
determining its revenue recognition policy?
4. Did its cost of goods sold increase or decrease over the last year?
What was the percentage change? What are some ways to decrease
cost of goods sold and what effect would this have on gross profit?
5. Compare the percentage change in revenue to the change in cost of
goods sold. Are they similar? If they are not, does Management say
anything about revenues and costs that might explain a difference? If
they do, what reasons did management give for the change? (Look in
Management Discussion & AnalysisMD&A)
6. Did its net income increase or decrease over the last year? What was
the percentage change?
7. What method of depreciation does the company use? Where did you
find this? What are some reasons that a Company would use one
method of depreciation over another?
8. What amount is reported as depreciation expense for the current year?
Where did you find this? How much cash was used to pay for this
expense?
Balance Sheet
1. Did its total assets increase or decrease over the last year? What was
the percentage change? What was the largest asset?
2. Identify the balance sheet accounts that were most significant in
explaining the changes in total assets for the corporation? What
events might explain the reasons for the changes in these accounts?
Where did you get this information?
Cash Flow Statement
1. Did the company have a cash inflow or outflow from operating
activities? Which statement did you use to find this? What item(s)
caused it to be an inflow or outflow?
2. Did the company have a cash inflow or outflow from investing
activities? What was the largest item in investing activities (either a
use of cash or source of cashreport the largest)?
7.
8.
9.
10.
11.
3. Did the company have a cash inflow or outflow from financing

activities? What was the largest item in financing activities (either a
use of cash or source of cashreport the largest)?
Profitability ratios
1. Compute the asset turnover ratio and explain its meaning.
2. Compute the net profit margin ratio for the latest three years and
explain its meaning. Do you see any trend?
3. Compute the company's gross profit percentage for the latest three
years; is there a trend over the three years?
4. Compute the return on equity (ROE) for the last three years. Explain
its meaning. Is there a trend indicated?
5. In comparison to the previous year, has the corporation improved its
ability to generate a profit? Justify your answer with the ratios you
calculated in b, c and d. Does management offer an explanation for
any changes or stability in the profitability of the corporation?
6. What is the basic earnings per share for continuing operations as it
appears in the income statement for the past two years? Was the
change in EPS a result of changes in the numerator or denominator?
Liquidity
1. Compute the company's current ratio for the last two years and explain
its meaning. Is the current ratio adequate?
2. Compute the companys receivable turnover for the last two years and
explain its meaning.
3. What amount of inventory does the company have at the end of the
year? Did it increase or decrease over the last year? Where did you
find this?
4. Compute the inventory turnover ratio. How is a low or high turnover
ratio significant?
5. What inventory costing method does the company use? Where did you
find this?
Solvency ratios
1. Compute the debt-to-asset ratio for the last two years and explain its
meaning. How did the debt position change over the last year? What
were the sources of these changes? Would potential lenders prefer the
debt to total assets ratio to be larger or smaller? Why?
2. Compute the times interest earned for the past two years and explain
its meaning.
Would you invest in this company? Why or why not? Support your answer.
Would you lend this company money? Why or why not? Support your answer.
Submit: the following on Week 10

1. Your answers to the all questions 1-11. Label and number the answers to the
questions.
2. A copy of the four financial statements (do not include the notes).
3. Just staple your project, do not put in a folder.
Please note:
1. Make two copies of your report, one to be handed in to the
professor, the second to be used in the Team Project. The Individual
report will not be returned to you.
2. Late projects will not be accepted. To be assigned to a group, you
must submit your project on the due date.
Team Project: (Due: Week 14)
After you submit your Individual Report, you will be assigned to a group. Each
member of the group would have worked on a different company for their
individual report.
1. Prepare a table with columns used for the companies (latest year) and
industry, and rows for each of the following items you calculated:
4a Percentage change in revenues
4c
Percentage change in cost of goods sold
4e
Percentage change in income
5a
Percentage change in assets
7a
Asset turnover
7b
Net profit margin
7c
Gross profit percentage
7d
Return on equity
8a
Current ratio
8b
Receivable turnover
8c
Inventory turnover
9a
Debt to asset ratio
9b
Times interest earned
Use the table to help you write a report comparing and contrasting the
companies and the industry ratios (where applicable) on these items. Use
the copy of your individual report and the ratios provided in the back of
the assignment to prepare this table.
2. Evaluate the companies using the industry ratios found on Industry Ratio
Report for Restaurants (the industry is SIC 5812) which is attached.
3. Before you prepare the report, evaluate each company's results for
reasonableness. If a company is very different from the other companies,
there may be a mistake. If it is very different (i.e. not a mistake), try to
find out why and report it.
4. Which company appears to be the best investment and why?
5. Which company would you lend money to and why?
Submit on May 1
1. The table on requirement 1 and your answers to questions 2-5 above. There
is no need to attach your individual reports.
Additional Instructions:
The individual reports are due on April 4 and team reports are due on May 1.
The individual report will not be returned, keep a copy for yourself and for preparing
the team report. Both the individual and team reports "typed". A copy of the four
Financial Statements (but not the Financial Notes) for your company should be
attached to individual reports. Any figures used from these reports should be
highlighted or circled in colored ink so that the reviewer can easily trace amounts
and information to/from the Project to the 10-K.
Make sure that you read the 10-K. A lot of the information to answer your
questions can be gleaned from it and you can use it to assist you in
answering your question for the project as long as you cite it properly. If you
attempt to hunt and peck for the answers (or use Ctrl F) and not use the
information presented in the 10-K, such as managements discussion and
analysis, your project will be adversely affected.
Any ideas, paraphrasing or quoting needs to be cited and footnoted!!
Using thoughts, words or phrases that are not your own without citing the
proper source is plagiarism.
Individual reports count 70% and the team report 30% toward each students
overall grade for the project.
Each student will evaluate his/her team member contribution to the project
and must be submitted with the group project on the due date. The professor
may use this evaluation to reduce the team member's "team" grade.
Use the Form 10-K from the latest year (should have been submitted in 2007
or 2008).
Please use properly constructed sentences, grammar (i.e. spelling,
punctuation and use of $ signs), and logical reasoning. Do not use circular
reasoning. Make sure that you answer the questions as to "why" the
numbers have changed. While it is ok to define something, please do not
think that is an answer. Put the time, thought and effort into answering the
questions. If you go for the minimum answer, you grade will reflect the
minimum effort. Make sure that you have your team members read your
project as sometimes you will not see something obvious as you are the
author.
Presentation does count.
AC 211 Assessment Rubric: Demonstrated Business Research Skills
Above Acceptable: Research exceeded requirements; all of the
Acceptable criteria accomplished; researched additional information
about the company or industry.
Acceptable: Research met requirements; 10-K retrieved; financial
statements utilized for most of the calculations; MD&A utilized and cited;
footnotes cited; audit report date provided.
Below Acceptable: Research did not meet requirements; financial
summaries (rather than financial statements) used for significant amount of
the data; MD&A not utilized nor cited; footnotes rarely cited, if at all.
Learning Outcomes
2) Apply proper accounting
standards and proper cost
accounting concepts to solve
problems
Course(s)
Where
Measured
Number
Of
Students
Measured
Number
Of
Sections
Measured
Number of
Students
Above
Acceptable
Number of
Students
Acceptable
Number of
Students
Below
Acceptable`
AC 211
AC 212
218
168
9
7
46 (21%)
25 (15%)
83 (38%)
93 (55%)
89 (41%)
50 (30%)
______________________________________________________________________________
All nine sections of AC 211 (Introduction to Financial Accounting) and seven
sections of AC 212 (Introduction to Managerial Accounting) were required to
include a common (to the respective courses) set of twenty multiple-choice
questions as part of their final examination. These questions were weighted
30-40% of each instructors final examination.
The median score for AC 211 was 13, and only 37% of the students achieved
an acceptable score (at least of 14 questions answered correctly) or better.
This is well below the goal of 80% of students achieving an acceptable or
better score, and a decrease from Spring 2010, when 41% of students in a
smaller sample were above acceptable.
The median score for AC 212 was 13, and only 70% of the students achieved
an acceptable score (at least of 12 questions answered correctly) or better.
The median score is virtually unchanged from Spring 2010 and well below
the goal of 80% of students achieving an acceptable or better score.
The median score for AC 211 was 13 out of the 20 questions answered
correctly, one lower than in Spring 2009. Two revisions were made to the
test in Spring 2010. Two easy questions answered correctly by nearly every
student were replaced by questions that required a better understanding of
the course material. There was a misunderstanding about gathering data for
AC 211 in Spring 2010. Initially it was thought that data would be collected
in the Fall semester only for AC 211 and AC 212. When it was discovered
that the School of Business wanted data for the Spring Semester as well, a
lack of cooperation from some AC 211 instructors resulted in data being
gathered in only four of nine course sections. Data were collected for all
sections in Spring 2009 and Spring 2011. The distribution of student scores
for AC 211 is shown in the table below:
AC 211: Introduction to Financial Accounting
Excellent (90% or more of the questions
answered correctly)
Good (80-89% of the questions answered
correctly)
Acceptable (70-79% of the questions answered
correctly)
Marginally acceptable (60-69% of the questions
answered correctly)
Unacceptable (59% and below of the questions
answered correctly)
Percentage of Total Students

Spring
Fall
Spring
2010
2010
2011
7%
5%
7%
9%
12%
14%
25%
21%
16%
*22%
29%
22%
*37%
33%
41%
*based on an estimated 22% - 20% breakdown of the 42% of students scoring 50-69%.
The data shows more students were able to improve their performance at
the high end, but the overall number of students achieving an acceptable
level of performance dropped by 4%. The coordinating meetings at the
beginning of each semester and the sharing of active learning exercises and
techniques have not resulted in an overall improvement in performance from
Spring 2010 to Spring 2011.
For AC 212, the median score was 13 out of the 20 questions answered
correctly, one better than in Spring 2009. The distribution of student scores
for AC 211 is shown in the table below:
AC 212: Introduction to Managerial Accounting
Above Expectations
(80% or more of the questions answered correctly)
Meeting Expectations
(60-89% of the questions answered correctly)
Below Expectations
(59% or less of the questions answered correctly)
Percentage of Total
Students
Spring
Fall
Spring
2010
2010
2011
19%
18%
15%
53%
46%
55%
28%
36%
30%
Forty-four percent of the students achieved an acceptable score or better.

The increased performance achieved in 2010 was sustained, but the
coordinating meetings at the beginning of each semester and the sharing of
active learning exercises and techniques have not resulted in an overall
improvement in performance from Spring 2010 to Spring 2011.
The students responses to each question were also analyzed. The students
were assessed in the following areas:
9
Cost management (Questions 1,2,5,6 & 9-12) 73% correct responses

versus 76% in Spring 2009. Students performed much better on the jobcosting question, 78% to 9%. Student performance on a conceptual
question the difference between financial and managerial accounting
improved to 76% from 51%. The poorest performance was 54% on a
computational question on cost behavior that had been answered
correctly by 63% of students in Spring 2010.
Decision analysis (Questions 7,8,17 & 18) 50% correct responses, down
from 51% in Spring 2009. As in Spring 2010, students did much better
using the cost-volume-profit model than using relevant cost analysis.
However there was a 75 decline in performance on a conceptual question
on CVP (down to 67% from 74%) while students performed better on the
relevant cost analysis computation (13% versus 7%). This was still by far
the lowest performance on any question. Some of this may be the
wording of the problem in the compressed time frame of a comprehensive
examination, where the student may have only a minute or two to devote
to this question.
Financial reporting (Questions 3,4,19 & 20). 56% correct responses

compared to 60% in Spring 2010. Only 48% of students could correctly
compute cost of goods manufactured, down from 55% in Spring 2010, and
their response to a conceptual reporting question was down to 58% from
69%. The students did very well on a conceptual question on cash flows,
but they had a great deal of trouble applying the concept. Only 25%
(down from 30% in 2010) were able to correctly determine cash flow from
operations.
Budgeting (Questions 13 & 14). 48% correct responses, essentially

unchanged from 47% in Spring 2010. Only 22% of students correctly
computed budgeted purchases, down slightly from the 25% in Spring
2010. This was very disappointing given the amount of time we spend on
budgeting. Students are not moving very well from creating budgeting
spreadsheets to creating the same computations by hand. 74% correctly
answered a question on budgetary slack, down from 77% in spring 2010.
Performance measurement (Questions 15 & 16). 82% correct responses

compared to 85% in Spring 2009.
Computational questions - applying concepts to solve problems

(Questions 4,6,7,10,12, 14,18 & 20). 44% correct responses compared to
48% in Spring 2010. Not surprisingly, students are having more difficulty
applying concepts in computational problems than they are in
remembering and identifying basic concepts.
10
We are not satisfied that the results of twenty multiple-choice questions is a

valid indicator of student knowledge. Our AC 211 team was more inclined to
stay with the multiple-choice questions, and they believe that some of the
poor performance is due to misreading or misunderstanding the questions.
They note that the majority of the CPA and CMA exams are multiple-choice
questions, and introductory students who aspire to careers in accounting
need to be prepared to be successful on those tests.
Our AC 212 team is seeking alternative means to assess students ability to
apply proper accounting concepts to solve problems. We also noted that
many students have difficulty moving from concept to application and at
least some students seem to have difficulty moving from working with
spreadsheets to performing computations by hand.
While results improved for both AC 211 and AC 212, there is still a long way
to go. AC 211 performance declined, in part due to a more difficult question
set, particularly for AC 212.
We need to get students to be more successful in applying concepts to solve
problems. In AC 211, the team wants to retain the 20 multiple-choice
question format for assessment for the time being, but they plan to work on
improving performance in the following two ways:
1. Review the questions used to ensure that they cover understanding
and application of core concepts, and that the questions are not
misleading. We will take advantage of the scanner purchased by the
school of business that provides more detailed item analysis of student
responses than was previously available.
2. Work to improve students ability to understand and analyze the
content of the questions.
AC 211 instructors are also testing the use of the online homework
management system that accompanies the text.
We remain concerned about the adequacy of 20 multiple-choice questions
for evaluating students ability to apply appropriate managerial and cost
accounting concepts to solve problems. During the Spring 2011 semester
we evaluated replacing the common questions with student performance on
a comprehensive managerial accounting case. The case was completed
throughout the semester and students had to respond to several questions
for each module. The instructors were not happy with the case, and there
was no evidence that using the test case improved performance as
measured by the twenty common final questions.
11
One hypothesis that emerged from our discussion of the consistently poor
results on the twenty common final questions: Students are trying to get
through exams (and other assignments) based on brute memorization. They
perform poorly on these questions because they are part of a comprehensive
portion of a final exam that emphasizes recent material not previously tested
on mid-term exams. Consequently, students focus on later chapters and
their capacity to memorize concepts from the entire semester fails them. We
do not want students to memorize, we want them to deeply learn
fundamental concepts and be able to apply them. The current text provided
step-by-step approaches to solving many common managerial accounting
problems. We thought that would make the processes clear, but it may have
encouraged memorizing steps rather than understanding the process.
Because we were not happy with the results of the comprehensive case, we
are exploring the possibility of using a series of problem-solving mini-cases,
with the final case being used for assessment.
Action items
For AC 211 and AC 212
1. AC 211 instructors will spend more time coaching students on
analyzing and interpreting multiple-choice question statements and
information.
2. AC 211 instructors will conduct an item analysis of the common twenty
multiple-choice questions, reviewing them for adequacy of covering
the core concepts and checking for misleading wording or other
problems based on Fall 2011 semester student results.
3. AC 212 instructors will change the text. The new text includes an
online homework manager as well as a LearnSmart practice tool that
adjusts the difficulty of questions based on student responses.
4. AC 212 instructors will develop a series of four to six mini-cases
requiring students to analyze a managerial problem and write a
memorandum summarizing their analysis and making a
recommendation.
Appendix
A)
B)
C)
D)
12
AC 211 Question Set.

1. When the future benefits of existing assets are used up in the ordinary
course of business:
a loss is recorded.
a credit to a liability is recorded.
a debit to assets is recorded.
an expense is recorded.
2. The separate entity assumption means:
A) each separate owner's finances must be revealed in the financial statements.
B) each separate entity that has a claim on a company's assets must be shown in
the financial statements.
C) a company's financial statements reflect only the business activities of that
company.
D) All of these.
A)
B)
C)
D)
3. On July 1, 2005, Icespresso Inc. signed a two-year $8,000 note receivable

with 9 percent interest. At its due date, July 1, 2007, the principal and
interest will be received in full. Interest revenue should be reported on
Icepresso's income statement for the year ended December 31, 2005, in the
amount of:
$420.
$1,440.
$360.
$720.
4. A company's balance sheet contained the following information:
A)
B)
C)
D)
Assuming Notes Payable is the only other item on the balance sheet, Notes
Payable must equal to
$72,000.
$200,000.
$344,000.
$8,000.
A)
B)
C)
D)
5. If an expense has been incurred but will be paid later, then:

an asset account is decreased or eliminated and an expense is recorded.
a revenue and an expense are recorded.
a liability account is created or increased and an expense is recorded.
nothing is recorded on the financial statements.
A)
B)
C)
D)
6. The primary goals of inventory management include:

minimizing the costs associated with maintaining inventories.
maintaining a sufficient quantity of inventory to keep customers satisfied.
maintaining sufficient quality of inventory to keep customers satisfied.
all of these.
A)
B)
C)
D)
7. The internal control principle related to separating employees' duties so that

the work of one person can be used to check the work of another person is
called:
independent internal verification.
rotation of duties.
duplication of responsibility.
segregation of duties.
13
A)
B)
C)
D)
8. A company expects to use equipment that cost $48,000 for ten years and
then sell it for $6,000. Using the straight-line method, the company should
report depreciation for the equipment of:
$8,400 per year.
$9,600 per year.
$4,200 per year.
$4,800 per year.
A)
B)
C)
D)
9. Your company buys a computer system from IBM for $3 million and pays IBM
$200,000 to install the computer system. Your company should record:
$2.8 million in equipment and the rest in expenses.
$3.2 million in equipment.
$3.2 million in expenses.
$3 million in equipment and $200,000 in expenses.
10. A dance studio accepts $1,500 to provide a series of dance lessons to a

youth group during the month of July. The studio decides to record the
revenue in July. The studio decided to record the July expenses of rent,
utilities and salaries in August, when it pays for them. One or both of these
decisions:
A) violate the accounting equation.
B) violate the matching principle.
C) are an example of accrual accounting.
D) violate the revenue principle.
11. All other things equal, in which of the following cases would an analyst rank
the company most favorably?
A) The company has the lowest debt-to-assets ratio in the industry as well as the
lowest asset turnover ratio while its profit margin is the highest.
B) The company has the lowest debt-to-assets ratio in the industry as well as the
highest profit margin and asset turnover ratio.
C) The company has the highest debt-to-assets ratio in the industry as well as the
highest profit margin while its asset turnover ratio is the lowest.
D) The company has the highest debt-to-assets ratio in the industry as well as the
highest profit margin and asset turnover ratio.
12. Over a two-year period, Coca-Cola's gross profit percentage went from
70.4% to 69.7%. Which of the following could have been the cause this
change?
A) Increased competition from Pepsi.
B) Reduced selling prices.
C) Rising product cost as a percentage of sales.
D) All of these may have caused the change.
13. A company files a Form 10-K with the SEC to submit its:
A) report of current events of financial importance.
B) press releases.
C) quarterly report.
D) annual report.
14
14. The LIFO inventory costing method assumes that the cost of the units most
recently purchased are:
A) not assigned to cost of goods sold or ending inventory.
B) the first to be assigned to cost of goods sold.
C) the last to be assigned to cost of goods sold.
D) the first to be assigned to ending inventory.
15. Cinno Company reported net income of $20,000 for the year ended
December 31, 2005. During the year, inventories decreased by $7,000,
accounts payable decreased by $8,000, depreciation expense was $10,000,
and accounts receivable increased by $6,500. Net cash provided by
operations in 2005, computed using the indirect method, was:
A) $22,500.
B) $38,500.
C) $51,500.
D) $10,500.
16. Cash flows from investing activities include cash:
A) inflows from the sale of long-term investments.
B) cash inflows from the sale of a company's own stock to its stockholders.
C) outflows from the sale of long-term investments.
D) inflows and outflows reflecting revenues and expenses.
17. If XYZ Company had $12 million in revenue and net income of $3 million
then its:
A) assets must have been $3 million.
B) expenses must have been $15 million.
C) expenses must have been $9 million.
D) assets must have been $12 million.
18. Which of the following would a company be most likely to overstate if the
company was trying to mislead potential external investors or creditors?
A) Salaries Expense.
B) Accounts Receivable.
C) Accounts Payable.
D) Notes Payable.
19. A corporate charter specifies that the company may sell up to 20 million
shares of stock. The company sells 12 million shares to investors and later
buys back 3 million shares. The current number of outstanding shares after
these transactions have been accounted for is:
A) 9 million shares.
B) 8 million shares.
C) 20 million shares.
D) 10 million shares.
15
20. On average, 5% of total accounts receivable has been uncollectible in the
past. At the end of the year, balance of accounts receivable is $100,000 and
the allowance for doubtful accounts has a credit balance of $500. Credit
sales during the year were $150,000. Using the aging of accounts receivable
method, the estimated bad debt expense would be:
A) $5,500.
B) indeterminable; the aging of accounts receivable method cannot be used,
because, based on this information, the percentage of credit sales method
should be used.
C) $5,000.
D) $4,500.
AC 212 Question set
1. Management accounting
a. provides objective financial information
b. must adhere to GAAP
c. has no mandatory rules
d. none of the other statements are true
2. Which of the following is not an objective of Management accounting?
a. To prepare external reports for investors, creditors, government agencies,
and other outside users
b. To provide information for costing of services, products, and other objects
of interest to management.
c. To provide information for planning, controlling, evaluating and
continuous improvement.
d. To provide information for decision-making.
3. Product costs
a. are inventoriable costs.
b. are manufacturing costs.
c. include direct materials, direct labor, and overhead.
d. are all of these.
4.
In July, Econo Company purchased raw materials costing $21,000 and incurred direct labor cost of
$18,000. Overhead totaled $32,000 for the month. Information on inventories was as follows:
July 1
July 31
Raw Materials
$ 6,200
$ 7,100
Work in Process
$ 700
$ 1,200
16
Finished Goods
$ 3,300
$ 2,700
What was the amount of Cost of Goods Sold for July for Econo Company?
a. $69,600
b. $70,200
c. $71,100
d. $71,300
5. Variable costs within the relevant range
a. stay constant on a per unit basis as output changes
b. increase in total as output increases
c. decrease in total as output decreases
d. answers a, b, and c are all correct
6. Maxwell Company makes treadmills. The company controller wants to calculate the fixed and variable
costs associated with the janitorial costs incurred in the factory. Data for the past four months
were collected.
Month
Lease cost
Machine hours
September
$ 11,000
575
October
11,400
610
November
10,200
510
December
10,725
550
Using the high-low method, what would Maxwell Companys estimated total janitorial cost be at a level
of 625 machine hours?
a. $11,580
b. $ 7,500
c. $ 4,080
d. $ 6,120
7. Paney Company makes calendars. Information on cost per unit is as follows:
Direct materials
$1.50
Direct labor
1.20
Variable manufacturing
overhead
0.90
17
Variable marketing expense
0.40
During 2009 fixed marketing expense totaled $13,000 and fixed manufacturing
overhead expense totaled $35,000. The selling price was $10 per calendar. How
many calendars did Paney Company have to sell to breakeven during 2009?
a.
2,167
b.
5,833
c.
8,000
d.
12,00
0
8. Assume in 2010, the contribution margin per calendar decreases for Paney
Company (and items that do not affect the contribution margin remain unchanged
from 2009). Compared to 2009, the break-even point in calendars sold for Paney
Company in 2010 will
a. be higher (more calendars will have to be sold in 2010 to breakeven).
b. be lower (fewer calendars will have to be sold in 2010 to breakeven).
c. be unchanged (the same number of calendars will have to be sold in
2010 as in 2009 to breakeven).
d. be a number that cannot be determined from the information given
9. The predetermined overhead rate is calculated by:
a. Estimated annual overhead/Estimated manufacturing cost
b. Estimated annual overhead /Estimated annual activity level
c. Estimated annual overhead/Actual Annual activity level
d. Actual annual overhead/Actual annual activity level
10.Stutz, Inc. designs and builds basketball gymnasiums. Each gymnasium is custom-built to individual
customers specifications. Stutz uses job-order costing to keep track of its costs. In February it worked on
three jobs. Data for these jobs are as follows:
Job 175
Job 178
Job 179
Balance 2/1
$ 13,790
$
0
$
0
Direct Materials
16,200
8,500
30,500
Direct Labor Cost
23,300
7,600
45,000
Machine Hours
400
300
2,000
Overhead is applied to jobs at the rate of $25 per machine hour. By February 28, Job 178 is the only one
unfinished. The balance of Finished Goods on February 1 is $94,000 (consisting of Job 177). Jobs 175,
and 179 are sold during February. Calculate the balance in Work-in-Process Inventory on February 28.
a. $23,600
18
b. $16,100
c. $212,390
d. $0
11.Using only unit-based activity drivers to assign non-unit-related overhead costs can
cause:
a.
efficiency
b.
product diversity
c.
activity sharing
d.
distorted product costs
12.Producing 10,000 cell phones requires $300,000 of prime costs, uses 2,000 machine
hours, and takes 1,200 setup hours. The activity rates are $40 per machine hour
and $100 per setup hour. Using activity-based costing, what is the total production
cost per unit for the cell phones?
a.
$ 40
b.
$ 50
c.
$ 60
d.
$ 100
13._______ occurs when a manager deliberately underestimates revenues or

overestimates costs.
a.
Goal congruence
b.
Pseudoparticipation
c.
Budgetary slack
d.
Setting standards too high
14. Gentry Company produces speaker systems for trucks. Estimated sales (in units) in
January are 20,000; in February 25,000; and in March 22,000. Each unit is priced at
$45. Gentry wants to have 25% of the estimated unit sales for the month on hand in
inventory at the beginning of each month. That requirement was met on January 1
with 5,000 speaker systems in beginning inventory.
Each speaker system requires 2 boxes. Boxes cost $5 each. Gentry wants to have 30% of the months
estimated production needs in raw materials inventory at the beginning of each month. On January 1,
Gentry had 9,000 boxes in inventory. How many boxes does Gentry expect to purchase in January?
a.
19
42,500
b.
48,050
c.
48,500
d.
57,050
15.The practice of delegating decision-making authority to the lower levels of

management in a company is
a. centralization.
b. performance evaluation.
c. decentralization.
d. authorization.
16. Bobick Company provided the following information for last year:
Operating income
Sales
$ 64,000
$ 200,000
Beginning operating assets

$ 387,000
Ending operating assets $ 413,000
Bobicks return on investment for last year was
a. 2.00 or 200%.
b. 0.50 or 50%.
c. 0.32 or 32%.
d. 0.16 or 16%.
17.Future costs that will differ depending upon which alternative future course of action
is chosen are
a. product costs.
b. sunk costs.
c. relevant costs.
d. variable costs.
18. Stein Company makes carpets. A customer wants to place a special order for 1,000 carpets in navy blue
with the company logo woven in the middle, to be priced at $30 each. Normally, Stein would charge $60
per carpet for this type of order. Stein figures that yarn and backing will cost $12 per carpet, variable
overhead (machining, electricity) is $5 per carpet, direct labor is $10 per carpet, and one setup will be
required at $800 per setup. The set-up charge costs are 100% labor. Currently, the workers needed to set
up for and make the carpets are working at Stein. Their wages will be paid whether or not the special
order is accepted. Steins policy is to avoid layoffs to the extent possible. If Stein accepts the special
order, by how much will operating income increase or decrease?
20
a.
$13,000 increase
b.
$ 3,000 increase
c.
$ 2,200 increase
d.
$13,000 decrease
19.The primary purpose of the statement of cash flows is to

a. show how much cash is due from customers and how much cash is owed to
vendors.
b. provide information about the sources and uses of cash during a period.
c. prove that revenues exceed expenses if there is a net income.
d. reconcile the cash balance shown on the bank statement to the balance shown on
the companys
books.
20.Stacy Companys net income last year was $27,000. No equipment was
purchased or sold during the year. Depreciation expense was $12,000. Changes for
the year in current asset and current liability accounts from the balance sheet
appear below:
Beginning
Balance
Ending
Balance
Increases
(Decreases
)
$ 50,000
$ 42,000
180,000
185,000
10,000
6,000
Accounts payable
49,000
60,000
Accrued liabilities
12,000
5,000
( 7,000)
Taxes payable
14,000
16,000
2,000
Current Assets (debit

balances):
Accounts receivable
Inventory
Prepaid expenses
$( 8000)
5,000
(4,000)
Current Liabilities (credit

balances):
11,000
Based solely on this information, the net cash flows from operating activities
under the indirect method on the statement of cash flows would be:
a. $2,000.
b. $38,000.
21
c. $39,000.
d. $52,000.
Assessment Rubric: Learning objective 1.2 AC 211 & AC 212

Above acceptable:
Acceptable:
22
16-20 correct.
12-15 correct.
Below Acceptable:
11 or fewer correct. Department: Accounting

Learning Outcomes
3) Interpret external financial
statements
Course(s)
Where
Measured
Number
Of
Students
Measured
Number
Of
Sections
Measured
Number of
Students
Above
Acceptable
Number of
Students
Acceptable
Number of
Students
Below
Acceptable`
AC211
241
54 (22%)
136 (57%)
51 (21%)

Students must demonstrate the technical knowledge and analytical ability to
correctly compute financial ratios and show that they understand their
meaning. They must demonstrate critical thinking skills by making decisions
on whether or not they would invest in or lend to the company. In other
words, they must adopt two different perspectives and defend and explain
the decision they make in each perspective.
There was a misunderstanding about gathering data for AC 211. Initially it
was thought that data would be collected only in the Fall semester for AC
211. When it was discovered that the School of Business wanted data for the
Spring Semester as well, a lack of cooperation from some AC 211 instructors
resulted in data being gathered in only four of nine course sections. All nine
sections were assessed in Spring 2011. The numbers for Spring 2011
reported above are an average of the results for two decisions, an investing
decision and a lending decision. In the past, including Spring 2010, students
have performed better on the investing decision than on ending decision
than on the lending decision. In the Spring 2011, aggregate student
performance was nearly identical on both decisions. This semester the
percentage of students with an acceptable or better response declined
slightly from the same semester last year: 79% percent of the students had
valid reasons on whether to invest and 77% percent had valid reasons on
whether to lend to the company they are analyzing versus 86% and 80%
respectively last year. However, more students performed at the above
acceptable level, 22% in Spring 2011 compared to 9% in Spring 2010. As
was the case with the problem-solving assessment, we see more students
above acceptable and more below acceptable. The results exceed the goal
of 70% of students achieving at least acceptable performance.
23
Critical Thinking: Some students seemed unable to connect the individual
questions on the financial statements and financial ratios they calculated to
the lending and investing decision. We believe that the students should be
using other references (such as trends, industry ratios, and competitive
companies) and other information available when making their decision.
They should also be including their own common sense and their knowledge
of the company/industry.
Analytical skills: The majority of students were able to calculate the financial
statement ratios appropriately. Most often, their interpretation was just the
meaning of the ratio taken from the textbook. They did not connect the ratio
to the company they were analyzing.
Team building skills: Each student was assigned to a group which required
the groups to compare each students company to the other companies in
the group on certain ratios. Most teams worked well together.
These results are essentially unchanged from the previous semester. The
problems encountered by the weaker students persist.
Each semester different instructors teach this course so we would advise that
each instructor go over the project when covering Chapter 5 in the textbook.
We would also recommend that each instructor go through Chapter 13 briefly
to introduce this chapter and its relevance to the project. Each instructor is
allowed to use an industry of their own choosing. Some industries may be
easier to analyze or easier for the students (largely sophomores) to relate to.
Action items:
1. Remind instructors, especially new instructors, to go over the financial
statement analysis project when covering chapters 5 and 13 during the
coordinating meeting at the beginning of the semester.
2. Discuss industry selection with instructors at the coordination meeting
at the beginning of the semester. Try to choose industries that will
resonate with students while also providing reasonable ratios for
analysis.
3. Encourage instructors to discuss the meanings of ratios using company
examples to provide context.
Appendix
Assessment instrument: AC 211 Introduction to Financial
Accounting Spring 2011
24
FINANCIAL REPORTING & ANALYSIS TEAM PROJECT (See BSBA
Objective 1.1)
(The responses to items 10 & 11 on the individual portion of the
project are used for assessing learning objective 1.3)
Assessment Rubric: AC 211
Introduction to Financial Accounting Spring

2011
Criteria
Above acceptable: reasons for investing/lending are above and beyond

Satisfactory; included comparisons to industry AND prior years
Acceptable: reasons for investing/lending are backed up by references to
appropriate ratios;
Below acceptable: reasons for investing/lending are incorrect (inconsistent with
ratios) or reasons are not given.
25
Learning Outcomes
4) Apply spreadsheet skills
Course(s)
Where
Measured
Number
Of
Students
Measured
Number
Of
Sections
Measured
Number of
Students
Above
Acceptable
Number of
Students
Acceptable
Number of
Students
Below
Acceptable`
AC212
168
78 (46%)
62 (37%)
28 (17%)

Students were assigned a budgeting project requiring each student to build a
complete set of master budget schedules for four quarters including annual
totals for a manufacturing company. Students demonstrated their
spreadsheet skills by developing appropriate cell formulae, using cell
referencing to link budget schedules to avoid duplicate entry of data and
provide automatic updating for changes in assumptions, and by modifying
display settings for readability and professional appearance.
As shown in the table in section 1, 83% of students performed at an
acceptable level or above compared to 81% during the Spring 2010
semester, exceeding the 70% goal.
In Spring 2010, a supplementary Excel textbook was added to the required
materials. The two sections that gave course credit for the Excel Quick
assignments did not have higher scores on Excel competency on the project.
We decided the cost of the supplementary Excel book exceeded the benefit.
The School of Business has instituted a SPA (student professional
advancement program) that includes some sessions on basic Excel concepts
and techniques early in the semester and more advanced topics later in the
semester. Rather than requiring the additional Excel text and assignments,
we decided to use early assignments to identify students needing extra help
in Excel, and to direct those students to sources for Excel help, including the
supplemental text, on-line help, or workshops.
We need to continue to monitor the performance of the weaker students, and
26
determine whether or not the students identified as weak in Excel early in
the semester are taking advantage of the workshops offered through the SPA
program.
We have decided against using a comprehensive business case for the AC
212 assessment, but we are exploring whether one or more smaller Excel
assignments may be better than the budgeting project to assess Excel skills.
A change in the assessment tool would necessitate a change in the
assessment rubric.
Action Items:
1. Identify weak performers and see if they were identified as weak Excel
users early in the semester, and if so, did they take advantage of the
Spa workshops or avail themselves of other help building Excel skills
outside class.
2. Evaluate use of smaller Excel assignments as an assessment tool
Budgeting Project Spring 2011

AC 212 Introduction to Managerial Accounting
Hard copy due April 22, 2011
No late submissions will be accepted.
Student Name:
________________________________________________________________________
I understand that this assignment is open book and open notes and is to be completed
individually. I certify that I have not used the assistance of any other individual(s) in any form
(verbally, written notes specific to this assignment, email, IM, cell phone etc.) other than my
Professor. I have read the Academic Honesty Policy included in the AC 212 syllabus and have
completed this assignment in accordance with University Policies and the policies noted above.
Student Signature
______________________________________________________________________
Your name should be typed on all sheets turned in for evaluation. Staple all budget work
sheets to this cover sheet.
After I review the Master Budget and Pro Forma Financial Statements, I may require changes if
new information is available. Please design the Master Budget and Pro Forma Financial
Statements to allow changes to be incorporated easily and quickly with the formulas you will be
using. Also, as this will be distributed to various levels of management within the organization,
ensure that proper business written communication and Excel formatting is utilized (print in
landscape using dollar signs, commas, underlining, proper lining-up of amounts, correct
spelling, etc.)
27
Additional information pertaining to these tasks follows in the attached memo. DATE:
March 28, 2011
TO:
CCSU Consulting
FROM:
Brian Henry, President, Current Designs Kayaks
SUBJECT:
Master Budget for the fiscal year April 1, 2011 March 31, 2012
--------------------------------------------------------------------------------------------------------------------------------Our controller, Barry Buchanan, has not yet returned from his trip kayaking the
Lewis and Clark Expedition trail. We need the British Touring Divisions Master
Budget for the fiscal year ending March 31, 2012 for our corporate strategic
planning process, and we cannot wait for Barrys re-appearance. We would like you
to prepare the British Touring Divisions Master Budget for the fiscal year ending
March 31, 2012.
The deliverables are as follows:
1.
2.
3.
4.
5.
6.
Sales budget.
Production budget.
Direct materials purchases budget.
Direct labor budget.
Manufacturing overhead budget.
A schedule calculating the expected value of the finished goods inventory as
of March 31, 2012.*
7. Budgeted statement of cost of goods manufactured and sold for the fiscal
year ended March 31, 2012.*
8. Selling and administrative expense budget.
9. Budgeted income statement for the fiscal year ended March 31, 2012.*
10.An accounts receivable aging schedule (schedule of collections from accounts
receivable).
11.Schedule of cash payments on accounts payable
12.Cash budget.
All the Master Budget schedules except those marked with an asterisk for the British
Touring Division should include a column for each quarter and a total column for the
fiscal year. We need only annual totals for the budgeted financial statements
(schedules 7 and 9) and we need only the fiscal year-end amount for the value of
finished goods inventory (schedule 6).
The hard copies of these budget schedules should be delivered by April 22, 2011.
You can print more than one schedule per page, but do not have a page break in
the middle of a budget schedule. I like to be able to view an entire budget schedule
without flipping back and forth between pages. Please also use a type font of
between 10-12 points for printing. We also need you to send us the Excel
spreadsheet you use to create the budget so we can use the spreadsheet to explore
the effect of changes in our assumptions about prices and volumes of activity. We
need that spreadsheet file by April 22, 2011 as well.
Ive attached a brief description of the British Touring Division to the budget data
Barry gave me before he left to follow the Lewis & Clark Expeditions Trail. We
eagerly await your results.
28
Sincerely,
Brian Henry
Brian Henry, President
29
Brian Henry founded Current Designs in 1982 out of a deep passion for kayaking.
Brian's creative talents really emerged when he decided to design a new wave of
kayaks for today's paddler. In 1999, Current Designs was acquired by Wenonah
Canoe and now operates as a wholly owned subsidiary. In 2004, kayak production
was moved to a new 45,000 square foot state-of-the-art manufacturing facility in
Winona, Minnesota. Current Designs is organized into divisions, each specializing in
different types of kayaks. Many Current Designs kayaks are made using of
fiberglass and kevlar using traditional composite construction or Current Designs
new Thermoformed Composite System (TCS). However, the British Touring
Division produces polyethylene kayaks using a rotational molding process.
Rotational molding uses high temperature to melt polyethylene powder in a closed
rotating metal mold to produce a complete kayak hull and deck in a fraction of the
time required for other construction methods. This allows the British Touring Division
to produce high quality kayaks that can be sold profitably at a much lower price.
Current Designs employs proprietary process controls to produce the lightest
possible roto-molded kayaks. They use linear high-density polyethylene to
maximize stiffness without sacrificing impact strength. The high-density
polyethylene maintains its integrity over a broad temperature range and has added
stabilizers giving it increased protection from harmful ultraviolet rays.
British Touring kayaks have a low profile and a snug cockpit. They are designed for
stability and tracking in rough waters and high winds, but are less maneuverable
than recreational models and have limited cargo capacity. British Touring designs
are also good for back rolling and surfing. The Squamish pictured below is a typical
British Touring kayak.1
Kayak sales are strongest in the spring (April June), the first quarter of Current
Designs fiscal year and weakest during the winter (January March), the last
quarter of the fiscal year. The average selling price for British Touring kayaks is
expected to be $1,280 per kayak during the 2011-2012 fiscal year. The British
Touring Division of Current Designs forecasts the following number kayak sales.
Quarter
Kayak sales
First
700
Second
640
Third
520
Fourth
480
1 The company and the products depicted are real. Further information can be found at Current
Designs Kayaks http://www.cdkayak.com. The financial information is fictitious.
30
The collection pattern for Accounts Receivable is as follows:
o
o
o
60 percent of all sales are collected within the quarter in which they are sold
40 percent of all sales are collected in the following quarter.
There are no bad debts/uncollectibles.
Due to production delays caused by the installation of new equipment during the
past few weeks, the British Touring Division expects to have no finished kayaks in
inventory on April 1, 2011, the beginning of the first quarter of the new fiscal year.
To avoid having that problem in the coming fiscal year, the British Touring Division
would like to have the ending inventory of kayaks at the end of each of the first
three quarters equal to 45% of the budgeted sales for the next quarter. They
would like to have 320 finished kayaks on hand on March 31, 2012.
Quarter
First
Ending FG inventory in kayaks
as a % of the next quarters
budgeted sales
45%
Ending FG inventory in kayaks
?
Second
Third
Fourth
45%
?
45%
?
?
320
Each kayak requires an average of 55 pounds of polyethylene. The British Touring

Division buys polyethylene for $8.00 per pound and they expect the price to remain
constant throughout the year. They expect to have 14,000 pounds of polyethylene
on hand as of April 1, 2011, the beginning of the first quarter of the fiscal year. At
the end of each of the first three quarters, the British Touring Division would like to
have their direct materials inventory quantity to equal 50% of the amount required
for the following quarters planned production. On March 31, 2012, the end of the
fiscal year, British Touring Division would like to have 19,000 pounds of
polyethylene on hand.
Quarter
First
Ending DM inventory as a %
of the next quarters
production requirement
50%
Ending DM inventory in pounds
?
Second
Third
Fourth
50%
?
50%
?
?
19,000
The British Touring Division buys its polyethylene on account. It pays for 75% of its
purchases of direct materials in the quarter in which they were purchased and 25%
in the quarter after they were purchased.
Each kayak requires 12 hours of direct labor. Employees engaged in direct labor
will be paid an estimated $23.00 per labor hour. Wages and salaries are paid on
the 15th and 30th of each month.
Variable manufacturing overhead is estimated to be $11.00 per direct labor hour
for the coming fiscal year. All variable manufacturing overhead expenses are paid
for in the quarter incurred.
Fixed manufacturing overhead is estimated to total $60,000 each quarter, with
$24,000 out of the total amount of $60,000 representing depreciation on
31
equipment, molds, and the factory. All other fixed manufacturing overhead
expenses are paid in cash in the quarter they occur. The fixed manufacturing
overhead rate will be computed by dividing the years total fixed manufacturing
overhead by the years budgeted direct labor hours. Round the fixed overhead rate
to the nearest penny.
Variable selling and administrative expenses are estimated to be $256.00 per
kayak sold. Fixed selling and administrative expenses are expected to total
$30,000 each quarter, with $8,000 out of the total amount of $30,000
representing depreciation on the office space, furniture and equipment. Other than
depreciation, all selling and administrative expenses are paid for in the quarter they
occur.
On March 31, 2012 the British Touring Division plans to buy new equipment for
$240,000. The new equipment will be acquired at the very end of the year, so it
will not be used in production and sales during the coming year and it will not be
depreciated until the following year. The British Touring Division expects to pay 20%
down and finance the remaining 80% of the equipment cost with a note payable.
No interest payable will accrue on the equipment note payable until after March 31,
2012.
The British Touring Division must maintain a positive cash balance. Because it is
planning to re-build finished goods inventory over the course of the year, the British
Touring Division plans to borrow $400,000 arranging a five-year bank note on April
1, 2011, the first day of the new fiscal year. The note will carry an annual interest
rate of 6%, payable in quarterly installments of 1.5% paid on the last day of
each quarter. The British Touring Division will repay $100,000 of the principal
balance on the note on March 31, 2012, the end of the last quarter.
The above borrowing should be sufficient to maintain a positive cash balance for the
British Touring Division. If the cash budget shows a negative balance for any
quarter, the British Touring Division will have to borrow on its line of credit in an
amount sufficient to bring cash to a positive balance. Borrowing must be in even
$1,000 increments. To be conservative, assume the borrowing takes place on the
first day of the quarter. They also will have to pay interest on the last day of each
quarter of 1.5% of the total amount outstanding on the line-of-credit note (new
borrowing, plus any borrowings from prior quarters not yet repaid). They must
borrow enough to pay this interest payment and maintain a positive cash balance
for the month. Surpluses in the cash budget for any quarter should be used to
repay any outstanding line-of-credit notes in thousand dollar increments until the
note is completely paid or a further $1,000 payment will create a negative cash
balance. To be conservative, assume the repayments occur on the last day of each
quarter.
So, for example, if the British Touring Division had to borrow $20,000 on their line of
credit to maintain a positive cash balance in the second quarter and they had
sufficient cash to repay the loan in the third quarter, they would have to pay
interest at a rate of 1.5% in the second quarter (because borrowing is assumed to
take place at the beginning of the quarter) and they would also have to pay interest
32
at a rate of 1.5% on the $20,000 in the third quarter (because the repayment is
assumed to take place at the very end of the quarter).
As a division of Current Designs Kayaks, the British Touring Division does not pay
income taxes. All income taxes are charged to the parent company. The British
Touring Division will pay dividends of $2,500 each quarter to its corporate parent,
Current Designs Kayaks. The dividends must be paid, even if the British Touring
Division has to borrow on its line of credit to make the payment
The budgeted balance sheet for the British Touring Division at the close of business
on March 31, 2011 (which is the same as the budgeted balance sheet at the
beginning of business April 1, 2011) is presented below. Current Designs Kayaks
owns 100% of the Capital Stock of the British Touring Division.
BRITISH TOURING DIVISION CURRENT DESIGNS KAYAKS

BUDGETED BALANCE SHEET
MARCH 31, 20011
ASSETS
LIABILITIES & EQUITY
Accounts
Cash
$120,000
Payable
$50,000
Accounts Receivable
250,000
Notes Payable
0
Raw Material
Inventory
112,000
Capital Stock
3,000,000
Retained
Plant and Equipment
2,800,000
Earnings
232,000
TOTAL ASSETS
$3,282,000
TTL LIAB. & SE
$3,282,000
Assessment Rubric AC 212, Introduction to Managerial Accounting,

Spring 2010
Apply Spreadsheet Skills
Above acceptable: Includes all of acceptable; given data are entered
once and only once in the model and are incorporated by cell reference
thereafter; all computations are built into cell formulae; numbers are
aligned and formats are appropriate.
Acceptable: Budget schedules are well constructed but there are
instances where initial data are re-entered rather than linked to prior
schedules; budget schedules are mostly well presented but there are a few
instances where formats are inappropriate or labeling is unclear.
33
Below acceptable: Spreadsheet cells are mostly typed rather than the
budgeting model built into the spreadsheet; minimal cell referencing and
cell formulae; schedules not well presented with unprofessional labeling
and formatting.
34
Learning Outcomes
5) Solve problems using
managerial models
Course(s)
Where
Measured
Number
Of
Students
Measured
Number
Of
Sections
Measured
Number of
Students
Above
Acceptable
Number of
Students
Acceptable
Number of
Students
Below
Acceptable`
AC212
168
70 (42%)
75 (44%)
23 (14%)

The same budgeting project used to assess spreadsheet skills in learning
outcome 4 allows students to demonstrate their ability to solve problems
using managerial models. In this case, the students build a resource
acquisition and consumption (master budget) model in Excel, modeling the
interrelationships between the firms activities to project resource availability
and resource needs for a year of activity. Students ability to model the
firms activity was assessed using a rubric.
As shown in the table in section 1, 86% of students performed at an
acceptable level or above, compared to 82% in Spring 2010, above the 70%
goal.
The results are slightly below the Spring 2010 results, although the
percentage of students performing above acceptable was lower in Spring
2011 than in Spring 2010. Student performance was disappointing on the
budgeting questions on the common final.
Some students have difficulty dealing with the differences caused by
physical inventory in a production setting. For many this is their first
exposure to accounting for manufacturing rather than a merchandising or
service environment.
While we anticipate continuing to assign a comprehensive budgeting
problem, we are considering moving to mini-cases requiring the application
of different managerial models to assess this learning outcome.
35
We evaluated using a comprehensive business case in Spring 2011 to assess
this learning outcome and decided against adopting the comprehensive
business case. We will explore using mini-cases involving other managerial
models to evaluate this learning outcome.
Action Items:
1. Evaluate use of problem solving mini-cases as an assessment tool.
2. Identify exercises to help students better relate to
manufacturing/production settings.
3. See if the budgeting presentation and exercises in the new textbook
lead to better internalization and success applying the budget model
outside the case assignment.
Appendix
Assessment Instrument AC 212, Introduction to Managerial
Accounting, Spring 2011
Budgeting Project Spring 2011 (See BSBA Goal 1, Learning outcome
4)
Spring 2011
Solve Problems Using Managerial Models
Above acceptable: Includes all of acceptable; the budget schedules are
completely accurate, or accurate except for a few minor errors (errors not
involving a misconception about the companys cost and revenue
structure).
Acceptable: All the budget schedules are presented and are mostly
correct, but there are one or two significant errors and some minor errors.
The cash budget and pro forma statements contain some errors.
Below acceptable: One or more budget schedules are missing. Overall,
the budget schedules do not reflect the companys cost and revenue
structure and expected results. The cash budget and/or pro forma
statements have several significant errors.
36
Goal: BSBA-2 - Critical Thinking: A graduate will be able to evaluate,
analyze, and interpret information to solve problems and make business
decisions.
Learning Outcomes
1) Use information to support
analysis
Course
Where
Measured
Number
Of
Students
Measured
Number
Of
Sections
Measured
Number of
Students
Above
Acceptable
Number of
Students
Acceptable
Number of
Students
Below
Acceptable`
AC212
131
61 (47%)
41 (31%)
29 (22%)

We use an ethics essay assignment to evaluate students critical thinking. In
the past we, had used mini-cases from the text for this assignment. In the
Spring 2011, we tried to incorporate more coverage of ethics into the
managerial accounting curriculum using the Ethics Game, an online ethics
training module. Students completed an ethical lens inventory and two
cases involving ethical dilemmas in accounting. Students demonstrate their
ability to draw on relevant information to support their analysis. Information
included information on the four ethical lenses, other information from the
Ethics Game exercises, relevant sections of the IMA code of ethics, and
values frameworks, including one presented in the text. Students ability to
draw on relevant information to support their analyses of the ethical
dilemma was evaluated using the same rubric we used in evaluating the
mini-case assignments from the text.
As shown in the table in Section one, 80% of the students evaluated
demonstrated acceptable performance or better, exceeding our goal of at
least 70%. The performance of almost 47% of the students was rated above
acceptable.
The same percentage of students performing at an acceptable level or better
was about the same this semester (80%) as in Fall 2010 (79%). (Data were
not collected and assessed on this goal in Spring 2010.) However, the 47%
of students performing at an above acceptable level was a marked increase
over Fall 2010, when 29% of students performed at an above acceptable
level. This level of performance was particularly gratifying given that it was
the first semester using the Ethics Game, and we had some issues with the
37
assignment that will be discussed under Goal three below. We attribute the
stronger performance to an effort add more assignments requiring students
to express their ethical reasoning in writing, and a reduction in the variability
in the amount of preparation the students have (for example, having
previously responded to a similar case, being shown an example of an
excellent response to a similar case, class discussion of critical analysis and
presentation of analysis, etc.).

We are going to document differing class coverage of the ethics essay and
related assignments and compare results to determine most successful
practices.
Action items:
1. Add more mini-cases requiring students to express their reasoning in
writing.
Appendix
Spring 2011
Critical Thinking Use Information to Support Analysis
Above acceptable All of acceptable; Identifies and focuses on the most
important information. Key facts are identified, discussed, and very well
linked to relevant legal and ethical standards. Argues convincingly in a
coherent discussion. Any uncertainties are acknowledged and appropriately
addressed. Assumptions are reasonable and well explained.
Acceptable Facts are discussed and linked to relevant legal and ethical
standards. Argument is consistent with and refers to the discussion of the
facts.
Below Acceptable Very limited discussion of facts with little or no link to
relevant ethical and legal standards. Argument is disorganized, or contains
some contradictory or unsupported assertions.
38
Goal: BSBA-3 - Ethics and Global Perspective: A graduate will be able to
apply ethical reasoning in domestic and global business situations.
Learning Outcomes
1) Students will display a
willingness to adhere to ethical
obligations and disclosures of
pertinent information.
Course(S)
Where
Measured
Number
Of
Students
Measured
Number
Of
Sections
Measured
Number of
Students
Above
Acceptable
Number of
Students
Acceptable
Number of
Students
Below
Acceptable`
AC212
131
59 (45%)
50 (38%)
22 (17%)

In the past we had used mini-cases presenting an ethical dilemma in the text
as the assignment for evaluating this goal. Each instructor selects one of the
cases and has the students either: write an essay addressing the ethical
issues presented in the case, write a memorandum from the perspective of
one of the actors in the case, or write a memorandum advising one of the
actors in the case. Students demonstrate their willingness to adopt an
ethical perspective appropriate for a management or accounting professional
in a global economy through their analysis and recommendations for
resolving the dilemma. Student responses were evaluated using a rubric.
In the Spring 2011, we tried to incorporate more coverage of ethics into the
managerial accounting curriculum using the Ethics Game, an online ethics
training module. Students completed an ethical lens inventory and two
cases involving ethical dilemmas in accounting. The Ethics Game requires
students to respond to a series of questions on the ethical dilemma and
provides a structured approach to the process of evaluating the ethical
dilemma. The student are also asked to provide an open-ended response
explaining their reasoning for the recommendations they provide to one of
the actors in the case. The on-line game also provides a grade for the
student that incorporates time spent on task, and times accessing the
supporting online resources as well as the student responses to the
questions. We were hoping this scoring would provide an unbiased measure
we could use in assessment, but for this semester we asked the students to
write a memorandum similar to those we had been using with the mini-cases
in the text. We evaluated the ethical content of that memorandum using our
existing rubric.
As shown in the table in Section one, over 83% of the students evaluated
39
demonstrated acceptable performance or better, above our goal of at least
70%. Forty-five percent of the students performed at an above acceptable
level.
Student performance was approximately the same this semester as it was
during the Fall 2010 semester (83% vs. 81% at acceptable level or above and
45% vs. 47% at an above acceptable level).
Overall the faculty were pleased with the Ethical Lens exercise provided by
the Ethics Game. They felt the exercises generated good class discussion,
provided the students with more context for evaluating ethical dilemmas,
and made them take a more nuanced view of ethical decision-making. The
faculty were less pleased with the on-line case assignments. Some students
had problems with the interface, and the space and structure of the openended responses did not yield the quality of writing we were looking for.
More distressing, a significant number of students (37) did not complete the
on line assignment, taking a zero on the assignment (5-10% of their grade)
rather than paying the $29 fee to complete the module.
The $29 was a reduced price we negotiated to use the Ethical Lens Inventory
and the Ethics Game cases on a trial basis. On a regular basis the Ethical
Lens Inventory model alone costs $29.
Overall we liked the Ethical Lens Inventory felt the cost exceeded the
benefits to the students. We preferred having the students work on Ethical
Dilemmas off line.
At the Spring 2011 assessment retreat, AC 212 faculty reported on their
experiences to date during the Spring 2011 semester. At that retreat we
decided to discontinue use of the Ethics Game. Instead we would return to a
series of 2 3 mini-cases, using the final case for our assessment. We would
select cases from the new text we were adopting if suitable cases were
available, or draw on cases from professional accounting organizations such
as the IMA. We also decided to explore using a similar series of mini-case
assignments to replace our twenty multiple-choice questions to assess
students ability to apply proper cost/managerial accounting concepts. We
believed that would give us a richer assessment than the multiple-choice
questions as well as providing more practice applying analytical reasoning to
more complex problems and explaining their reasoning in writing.
Action items:
1. Find or create 2 -3 mini-cases involving ethical dilemmas in a
40
managerial accounting context for use as common assignments in the
managerial accounting course.
41
Appendix
Spring 2011
Ethics and Global Perspective Students Display a Willingness to
Adhere to
Ethical Obligations and Disclosures of Pertinent Information
Above acceptable All of acceptable applicable legal requirements and
codes of ethics are recognized and well discussed. Legal and ethical
ramifications (compliance or noncompliance) of their choice or
recommendation are completely addressed. The choice or recommendation
fully satisfies relevant legal and ethical obligations.
Acceptable Basic recognition of applicable legal requirements and codes
of ethics. Legal and ethical ramifications (compliance or noncompliance) of
their choice or recommendation are at least briefly addressed. The choice
or recommendation shows intent to fulfill legal and ethical obligations.
Below acceptable Failure to recognize applicable legal requirements or
codes of ethics. Choice or recommendation fails to fulfill legal and ethical
obligations.
42

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Appendix A, Exhibit 5: BSBA Goals Assessed in Accounting based on Spring 2011 Data

1) Apply business research skills

3. What types of products or services does it sell/serve? Where did you

3. Did the company have a cash inflow or outflow from financing

Submit: the following on Week 10

Percentage change in cost of goods sold

Percentage change in income

Percentage change in assets

Net profit margin

Gross profit percentage

Debt to asset ratio

Times interest earned

Percentage of Total Students

Forty-four percent of the students achieved an acceptable score or better.

Cost management (Questions 1,2,5,6 & 9-12) 73% correct responses

Financial reporting (Questions 3,4,19 & 20). 56% correct responses

Budgeting (Questions 13 & 14). 48% correct responses, essentially

Performance measurement (Questions 15 & 16). 82% correct responses

Computational questions - applying concepts to solve problems

We are not satisfied that the results of twenty multiple-choice questions is a

AC 211 Question Set.

3. On July 1, 2005, Icespresso Inc. signed a two-year $8,000 note receivable

5. If an expense has been incurred but will be paid later, then:

6. The primary goals of inventory management include:

7. The internal control principle related to separating employees' duties so that

10. A dance studio accepts $1,500 to provide a series of dance lessons to a

distorted product costs

13._______ occurs when a manager deliberately underestimates revenues or

Setting standards too high

15.The practice of delegating decision-making authority to the lower levels of

Beginning operating assets

19.The primary purpose of the statement of cash flows is to

Current Assets (debit

Current Liabilities (credit

Assessment Rubric: Learning objective 1.2 AC 211 & AC 212

11 or fewer correct. Department: Accounting

Goal: BSBA-1-Accounting - Mastery of Business Knowledge: Each

Section Two Findings

Introduction to Financial Accounting Spring

Above acceptable: reasons for investing/lending are above and beyond

Section Two Findings

Budgeting Project Spring 2011

Each kayak requires an average of 55 pounds of polyethylene. The British Touring

BRITISH TOURING DIVISION CURRENT DESIGNS KAYAKS

TTL LIAB. & SE

Assessment Rubric AC 212, Introduction to Managerial Accounting,

Section Two Findings

Section Two Findings

Section Four Use of Results

Section Two Findings

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