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Accounting you need to know to be ready for the MBA

Be ready to take the Managerial Accounting Course in the Masters of Business Administration
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Last updated 9/2016
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  • 5.5 hours on-demand video
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  • 64 Supplemental Resources
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This course prepares you to take your Masters of Business Administration degree. All business students have to take an introductory financial accounting course for one simple reason - accounting is the language of business. The terms used by business people such as capital, equity, assets, liabilities, revenue, net income etc. are all terms you will become very familiar upon completion of this course.

Learn and Master the Financial Accounting Process. Part 1 of this course.

  • Understand that accounting is the language of business.
  • Know business terminology (biz speak).
  • Understand the difference between a corporation and a single proprietorship.
  • Know the three forms of business - service company, merchandise company and a manufacturer.
  • Understand an Income Statement and how to prepare one.
  • Understand a Balance Sheet and how to prepare one.
  • Know how to analyse and record business transactions
  • Learn how to use debits and credits to record business transactions.
  • Know how to use the accounting journal and ledger,
  • Complete a set of accounting records for a service business using excel spreadsheets.

Learn and Master how to Read Financial Statements - Part 2 of this course.

  • Understand how to read the cash flow statement.
  • Learn how to perform horizontal analysis on the Balance Sheet.
  • Learn how to perform Vertical analysis on the Income Statement.
  • Know how to analyse whether a company is liquid..
  • Know how to analyse whether a company is solvent.
  • Know how to analyze a company's profitability.

This course is unique in that it contains an excel project on a set of accounting records

Who is the target audience?
  • This course is designed to prepare you for the Masters of Business Administration program
  • This course provides an overview of business and would be of interest to anyone who wants to know more about business
Students Who Viewed This Course Also Viewed
What Will I Learn?
Be able to Articulate a comprehensive understanding of accounting principles that guide measurement, recording, and reporting of financial activities of a business
Prepare financial statements for external users and understand how to use these statements in decision making
Measure and analyze the reporting of balance sheet and income statement accounts
Be able to Evaluate business performance using Ratio Analysis and other quantitative data analytics tools, techniques, and methods
Know how to Create a system of internal control for organizations
Know that many of the business terms are accounting terms
Understanding how the accounting system works will teach you many different business concepts
Understanding these business concepts are necessary if you are interested in obtaining your Master of Business Degree.
This course provides an overview of business and would be of interest to anyone who wants to know more about business
View Curriculum
  • You will need excel
  • The textbook is freely available on the net
Curriculum For This Course
Expand All 72 Lectures Collapse All 72 Lectures 05:44:27
Know how to talk like Business People - Learn Accounting
9 Lectures 37:52

This lecture introduces terms such as Assets, Liabilities, Capital, Equity. Revenue. Expenses. Income Statement, Retained Earnings and balance sheet.

Preview 14:42

Master the three forms ob business

Topic #2 - Business Terms

Master These Business Terms

Test Your Understanding - Level A (Knowledge questions)

Showme Problem #1 - Match these phrases

Showme Problem #2-Account Classifications

Showme Problem #3 - Classifying Business Accounts

Test Your Understanding - Level B (Application questions)
Know how to present Financial Statements Like an Accountant
11 Lectures 44:38

Introduces you to the Content and Purpose of the three financial statements -

Income Statement, retained earnings Statement and Balance sheet

Topic #2 - Introduction to Financial Statements

Master the income statement & retained earning accounts

Master the Balance Sheet Accounts

Test Your Understanding on Financial Statements - Level A (Knowledge questions)

On June 1, Vincent Service Co. was started with an initial investment in the company of $22,100 cash. Here are the assets and liabilities of the company at June 30, and the revenues and expenses for the month of June, its first month of operations:

Cash $ 4,600 Notes payable $12,000

Accounts receivable 4,000 Accounts payable 500

Service revenue 7,500 Supplies expense 1,000

Supplies 2,400 Maintenance and repairs expense 600

Advertising expense 400 Utilities expense 300

Equipment 26,000 Salaries and wages expense 1,400

In June, the company issued no additional stock, but paid dividends of $1,400.


(a) Prepare an income statement and a retained earnings statement for the month of

June and a balance sheet as at June 30, 2012.

Showme Problem #1 - Vincent Financial Statememts

Fedexpress Delivery was started on May 1 with an investment of $45,000 cash. Following are the assets and liabilities of the company on May 31, 2012, and the revenues and expenses for the month of May, its first month of operations.

Accounts receivable $ 6,200 Notes payable $28,000

Service revenue 10,400 Salaries and wages expense 2,000

Advertising expense 800 Equipment 56,000

Accounts payable 2,400 Maintenance and repairs expense 2,900

Cash 15,800 Insurance expense 400

No additional common stock was issued in May, but a dividend of $1,700 in cash was paid.


(a) Prepare an income statement and a retained earnings statement for the month of

May and a balance sheet at May 31, 2012

Showme Problem #2 Fed Express

Master the Classified Balance Sheet Accounts

Showme Problem #3 - Simpson Classified balance Sheet

Classified Balance Sheet Hotspot

Showme Problem Problem #4 - Kellogg

Test Your Understanding - Level B (Application Questions)
Know how to Analyze a Business Transaction
5 Lectures 35:33

Understand business transactions and how to record the effect of each transaction on the balance sheet equation

Topic #1 - Understanding Business Transactions and how to record them

Test Your Understanding - Section 3 - Level A Questions

On April 1, Omera Travel Agency Inc. was established. These transactions were completed during the month.

1. Stockholders invested $30,000 cash in the company in exchange for common stock.

2. Paid $900 cash for April office rent.

3. Purchased office equipment for $3,400 cash.

4. Purchased $200 of advertising in the Al Ain Times on account.

5. Paid $500 cash for office supplies.

6. Earned $12,000 for services provided: Cash of $3,000 is received from customers, and the balance of $9,000 is billed to customers on account.

7. Paid $400 cash dividends.

8. Paid Al Ain Times amount due in transaction (4).

9. Paid employees’ salaries $1,800.

10. Received $9,000 in cash from customers billed previously in transaction (6).


Analyze the transactions and their effect on the Accounting Equation – Assets= Liabilities+ Shareholder’s Equity

Showme Problem #1 - Omera Travel

Jarvis Consulting Inc., on May 1, 2012. The following transactions occurred during the month of May.

May 1 Stockholders invested $15,000 cash in the business in exchange for common stock.

2 Paid $600 for office rent for the month.

3 Purchased $500 of supplies on account.

5 Paid $150 to advertise in the County News.

9 Received $1,400 cash for services provided.

12 Paid $200 cash dividend.

15 Performed $4,200 of services on account.

17 Paid $2,500 for employee salaries.

20 Paid for the supplies purchased on account on May 3.

23 Received a cash payment of $1,200 for services provided on account on May 15.

26 Borrowed $5,000 from the bank on a note payable.

29 Purchased office equipment for $2,000 paying $200 in cash and the balance on account
Showme Problem #2 - Jarvis Consulting

Test Your Understanding - Section 3-Level B Questions
Know how to use Debits and Credits in accounting
5 Lectures 18:49

In section 2 I illustrated the income statement, statement of retained earnings and balance sheet. These statements are the end products of the financial accounting process.

The raw data of accounting are the business transactions.

You learned how to record transactions as increases or decreases in the assets, liabilities, and stockholders' equity items of the accounting equation. This procedure showed you how various transactions affected the accounting equation.

An account is a part of the accounting system used to classify and summarize the increases, decreases, and balances of each asset, liability, stockholders' equity item, dividend, revenue, and expense.

To illustrate recording the increases and decreases in an account, texts use the T-account, which looks like a capital letter T. The name of the account, such as Cash, appears across the top of the T. We record increases on one side of the vertical line of the T and decreases on the other side.

Topic #1 - Introducing Debits and Credits

Master Debit & Credit Journal Entries

Test Your Understanding - Level A ( Knowledge Questions)

Download hardcopy from resources.

Showme Problem -Classifying Business transactions

Test Your Understanding - Level B (Application Questions)
Know how to Journalize Business Transactions
9 Lectures 36:08
Topic #1 - Recording Business Transactions in the Journal

Test Your Understanding - Level A (Knowledge)


ACE Place

Selected transactions for Ace Place, an interior decorator corporation, in its first month of

business, are as follows.

1. Issued stock to investors for $15,000 in cash.

2. Purchased used car for $10,000 cash for use in business.

3. Purchased supplies on account for $300.

4. Billed customers $3,700 for services performed.

5. Paid $200 cash for advertising start of the business.

6. Received $1,100 cash from customers billed in transaction (4).

7. Paid creditor $300 cash on account.

8. Paid dividends of $400 cash to stockholders.


Prepare the debit–credit journal entry for each transaction.

Showme Problem #1 on debits and Credits _ Ace

Master the Ace Place journal entries

This information relates to Wilson Real Estate Agency.

Oct. 1 Stockholders invest $30,000 in exchange for common stock of the corporation.

2 Hires an administrative assistant at an annual salary of $36,000.

3 Buys office furniture for $3,800, on account.

6 Sells a house and lot for M.E. Petty; commissions due from Petty, $10,800

(not paid by Petty at this time).

10 Receives cash of $140 as commission for acting as rental agent renting an


27 Pays $700 on account for the office furniture purchased on October 3.

30 Pays the administrative assistant $3,000 in salary for October.


Prepare the debit–credit journal entries for each transaction.

Showme Problem #2 -Wilson Real estate

The May transactions of ABC Corporation were as follows.

May 4 Paid $700 due for supplies previously purchased on account.

7 Performed advisory services on account for $6,800.

8 Purchased supplies for $850 on account.

9 Purchased equipment for $1,000 in cash.

17 Paid employees $530 in cash.

22 Received bill for equipment repairs of $900.

29 Paid $1,200 for 12 months of insurance policy. Coverage begins June 1.


Prepare the debit–credit journal entries for each transaction.

Showme Problem #3 - ABC Corp.

Clean-Sweep Janitorial, Inc., a company providing janitorial services, was organized 2010 July 1.

The following account numbers and titles constitute the chart of accounts for the company:


No. Account Title

100 Cash

103 Accounts receivable

150 Trucks

160 Office equipment

170 Equipment

200 Accounts payable

201 Notes payable

300 Capital stock

310 Retained earnings

320 Dividends

400 Service revenue

506 Gas and oil expense

507 Salaries expense

511 Utilities expense

512 Insurance expense

515 Rent expense

518 Supplies expense

July 1 The Company issued 600,000 of capital stock for cash.

5 Office space was rented for July, and 5,000 was paid for the rental.

8 Desks and chairs were purchased for the office on account, 28,800.

10 Equipment was purchased for 50,000; a note was given, to be paid in 30 days.

15 Purchased trucks for 150,000, paying 120,000 cash and giving a 60-day note to the dealer for 30,000.

18 Paid for supplies received and already used, 2,880.

23 Received 17,280 cash as service revenue.

27 Insurance expense for July was paid, 4,500.

30 Paid for gasoline and oil used by the truck in July, 576.

31 Billed customers for janitorial services rendered, 40,320.

31 Paid salaries for July, 51,840.

31 Paid utilities bills for July, 5,280.

31 Paid cash dividends, 9,600.

a. Prepare general ledger accounts for all of these accounts except Retained Earnings. The Retained Earnings account has a beginning balance of zero and maintains this balance throughout the period.

b. Journalize the transactions given for July 2010 in the general journal.

c. Post the journal entries to ledger accounts.

Showme Problem #4 - Clean Sweep

Showme #5 - Clear View Miniature Golf

Test Your Understanding - Level B (Application)
Know how to post to the Ledger
6 Lectures 32:24
Topic # 1 - Posting to the General Ledger

Test Your Understanding -Level A - (knowledge)

Redix Finance Company, which provides financial advisory services, engaged in the

following transactions during May 2010:

May 1 Received 300,000 cash for shares of capital stock issued when company was organized.

2 The company borrowed 40,000 from the bank on a note.

7 The company bought 182,400 of computer equipment for cash.

11 Cash received for services performed to date was 15,200.

14 Services performed for a customer who agreed to pay within a month were 10,000.

15 Employee wages were paid, 13,200.

19 The company paid 14,000 on the note to the bank.

31 Interest paid to the bank for May was 140.

31 The customer of May 14 paid 3,200 of the amount owed to the company.

31 An order was received from a customer for services to be rendered next week, which will be billed at 12,000.

Journalize the above transactions and post to the following accounts in the ledger. Cash, Accounts

Receivable, Equipment, Notes Payable, Capital Stock, Service Revenue, Salary Expense, Interest expense

Showme Problem #1 A - Redix Co Journal Entries

Showme Problem 1 B - Post Redix journal entries

Sutherland Oasis was started on April 1 by David Sutherland. These selected events and transactions occurred during April.

Apr. 1 Stockholders invested $70,000 cash in the business in exchange for common stock.

4 Purchased land costing $50,000 for cash.

8 Purchased advertising in local newspaper for $1,200 on account.

11 Paid salaries to employees $2,700.

12 Hired park manager at a salary of $3,600 per month, effective May 1.

13 Paid $7,200 for a 1-year insurance policy.

17 Paid $600 cash dividends.

20 Received $6,000 in cash from customers for admission fees.

25 Sold 100 coupon books for $90 each. Each book contains ten coupons that entitle the holder to one admission to the park. (Hint: The revenue is not earned until the coupons are used.)

30 Received $7,900 in cash from customers for admission fees.

30 Paid $400 of the balance owed for the advertising purchased on account on April 8.

The company uses the following accounts: Cash, Prepaid Insurance, Land, Accounts Payable,

Unearned Service Revenue, Common Stock, Dividends, Service Revenue, Advertising Expense,

and Salaries and Wages Expense.

Showme Problem #2 Sutherland Oasis

Test Your Understanding - Level B - (Application)
Know How to Record the Transactions of a Merchandiser
8 Lectures 34:18
Topic #1 - Recording Purchase Transactions

Topic #2 - Recording Sales Transactions

Test Your Understanding - Level A ( Knowledge Questions)

Showme Problems #1 - Janssen, High Stereo and Murray Co

Showme Problem #2 - Kennedy

Showme Problem #3 - Curtain Co

Showme Problem #4 -White Oaks

Test Your Understanding - Level B - (Application)
Know how to Present a Multi Step Income Statement
7 Lectures 19:22
Topic #1 - The Multi Step Income Statement

Test Your Understanding - Multi Step Inc. St.- Level A ( Knowledge)

Two problems in excel on preparing a multi step income statement

Showme Problem set #1 - Multi Step

Showme Problem - Dykstra

Comprehensive problem - Cleary Financial statements

Comprehensive problem #2 - Wright Co's Financial Statements

Test Your Understanding - Multi Step Inc St. - Level B (Application)
Special Topics
2 Lectures 11:25

Adjusting entries are journal entries made at the end of an accounting period or at any time financial statements are to be prepared to bring about a proper matching of revenues and expenses.

Adjusting entries fall into two broad classes: deferred (meaning to postpone or delay) items and accrued (meaning to grow or accumulate) items. Deferred items consist of adjusting entries involving data previously recorded in accounts. These entries involve the transfer of data already recorded in asset and liability accounts to expense and revenue accounts, respectively. Accrued items consist of adjusting entries relating to activity on which no data have been previously recorded in the accounts.

Adjusting the accounting Records

Property, plant, and equipment (fixed assets or operating assets) compose more than one-half of total assets in many corporations. These resources are necessary for the companies to operate and ultimately make a profit. It is the efficient use of these resources that in many cases determines the amount of profit corporations will earn.

On a classified balance sheet, the asset section contains: (1) current assets; (2) property, plant, and equipment; and (3) other categories such as intangible assets and long-term investments. Previous lectures discussed current assets. Property, plant, and equipment are often called plant and equipment or simply plant assets. Plant assets are long-lived assets because they are expected to last for more than one year.

Know how to Present the Statement of cash flows
6 Lectures 51:28
Topic #1 -Purpose of The Statement Of Cash Flows

Topic #2 - How to prepare a statement of cash flows

Test Your Understanding - Cash Flows - Level A

Download the problem; try it then watch the video
Showme Problem #1 - Cash Flow problem - Vincent co

Showme Problem Set #1

Test Your Understanding-Cash Flows Level B
1 More Section
About the Instructor
4.2 Average rating
127 Reviews
4,894 Students
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Accounting Professor

I am a Professor of Accounting with over thirty-five years experience teaching accounting to college students, undergraduate and MBA university students as well as CMA candidates seeking to earn their Professional Certified Management Accountant Designation.

I achieved my Certified Management Accountant Designation 40 years ago. With that I then earned my Masters of Business Administration degree and later a PHD in accounting.

I have developed and will continue to develop a number of courses in both Financial Accounting and Management Accounting for you - a college or university student (or even a secondary student) to help you to achieve the best result in your undergraduate accounting course. If you get an "A" from me I guarantee you will get an "A" from your accounting prof.

For Graduate students, I have a course to prepare those of you who do not have a business degree for the Masters of Business Administration. Also I have a course at the masters level called Managerial Accounting.

For CMA Candidates, I have courses to prepare you to successfully pass their Certified Management Accounting Exams offered by Institute of Management Accountants.

Dr. John

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