AACC 201: ESSENTIALS OF ACCOUNTING

ACCOUNTING FOR ENTREPRENEURS

SPRING 2016: WHITMAN SCHOOL OF MANAGEMENT
PROFESSOR: ALEX THEVARANJAN athevara@syr.edu
Office Hours (visit in person, email or call 315 443 3355): Tuesdays & Thursdays 7-8 pm in Whitman 639
T. A.: PRIYANKA MUKHERJEE
pmukh100@syr.edu
Help Sessions: Fridays 1-2:30 pm in Whitman 203
Extra Help Sessions by Beta Alpha Psi: Mondays 2-3 pm & Wednesdays 12-1 pm in Whitman 231
COURSE DESCRIPTION
Accounting is a set of activities that translates day to day business transactions into quantifiable information useful for decision makers. Financial
accounting focuses on outside decision makers such as investors, creditors, customers, suppliers and produces financial statements in the form of
balance sheet, income statement and cash-flow statement. In contrast, managerial accounting focuses on inside decision makers, namely managers,
and provides concepts beyond the financial statements to enhance managerial decisions.
An entrepreneur is both an outsider (investor) and insider (manager). As such, an entrepreneurial context is a good platform to learn both financial
and managerial accounting. Accordingly, in this course, you will be required to form your own organization to meet a need in the market place that is
in line with your personal desires and assets. The financial and managerial accounting principles you learn in this course will help you make better
decisions and prepare a sound business plan of your entrepreneurial idea.
Accounting is also the language of business. In this role, it provides the entrepreneur the language to communicate between the branches of
business be it finance, marketing, operations or management. This is why I have sub-titled this course as: Accounting for Entrepreneurs.
LEARNING OBJECTIVES:
1. To identify a business idea in line with your DNA
2. To estimate and enhance the net cash flow of your organization
3. To learn accounting concepts that facilitate managerial decisions: IV, BEP, NPV, IRR, Tax Analysis and Optimal Financing
4. To understand the nature of balance sheet, income statement and cash flow statement
5. To prepare financial statements through the double entry process
6. To calculate and interpret ROI and the three DuPont Ratios
7. To prepare a business plan
8. To develop Excel skills
TEXT BOOK / CLICKER:
There is no required textbook for this course. All course-relevant materials will be posted on the blackboard. https://blackboard.syr.edu/.
For those who like to be able to refer a book, I recommend: Financial and Managerial Accounting, Information for Decisions, by Wild, Larson and
Chiappetta. McGraw Hill Irwin; the latest is the fifth edition but any earlier edition would be sufficient and cheaper.
You are required however to purchase any basic clicker which is available in the University Bookstore. Example: Response Card NXT

COURSE GRADE:
LECTURE NOTES
CLICKER QUESTIONS
HOMEWORK
GRADED LECTURE
NOTES
GRADED HOMEWORK
QUIZZES
BUSINESS PLAN
TOTAL
EXTRA CREDITS / DEBITS

10
10
10
10
10
20
30
100
?

COURSE STRUCTURE:
Each Tuesdays class will introduce an accounting concept required to answer an entrepreneurs question. Given that there is no required text for
this course, it is very important that you come to this class with your laptop and take good notes. At the end of each Tuesdays class, you will be
asked to submit your class notes on blackboard, each of which will earn you 1 point. As long as you submit 10 such in-class notes, you will earn the
full 10% of the grade allocated for lecture notes.
Each Thursdays class will begin with four clicker questions to test your understanding of the accounting concepts taught in the previous class
and the requirements of the homework assigned for that week. Each right answer to a clicker question will earn you a point. Accordingly, as long
as you get 20 clicker questions right, you will earn the full 10% of the grade allocated for clicker questions.
In the second part of each Thursdays class, we will begin solving the homework problem which is due by Saturday midnight (11:59 pm). In
case, we could not adequately cover the homework in class, a video tutorial will be posted by Friday 11 am. If you pay attention in Thursdays class
(and the video when necessary), you should easily be able to complete the homework. For those who may still lack confidence, a half an hour group
help- session will be conducted at Friday at 1 pm in Whitman 203 by the TA, who will go over once more the homework problem. As a last resort,
the TA will offer 1-1 help in the same room for another hour. Each homework will earn you 1 point and, as long as you submit 10 such homework
problems, you will earn the full 10% grade allocated for the homework questions. The homework questions will require that you keep trach with the
business plan we will develop as a class and the one you will develop with your partner. One of you have to submit the former and the second one
the latter. This arrangement is to encourage that both of you cooperate with each other while working together.
Note that the above structure allows you to score the full 30% points even if you had to miss a couple of classes due to unexpected
circumstances such as sickness, religious observances, athletic events, academic trips, family emergencies etc. Accordingly, You DO NOT
need to email me to get you excused for these misses.
In order to enhance the quality of your note taking, two in-class notes will be picked at random for grading, each accounting for 5 points. You will
receive only 3 points if all you had done is just completed the blanks, and 4 points if you had taken at least some extra notes (written in red ink), and
the full 5 points only if you had taken sufficient extra notes. Similarly, to enhance the accuracy of your homework, two homework will be picked at
random for grading, the full 5 points will be awarded only to those who have submitted a perfect answer.
There will also be two quizzes following important chapters (Quiz 1 following CH 7: Incremental Value Analysis, and Quiz 2 following CH 12 &
13::Transaction and ROI Analysis. Each quiz will account for 10 points, and therefore, together will account for 20% of the grade.

THE BUSINESS PLAN (30%)

Finally note that there is no final exam in this course. Instead, the final business plan essentially serves as a comprehensive take-home final exam.
This business plan should have two parts, each part accounting for 15% of the grade.
The first part (about 8-12 pages with 1.5 spacing) is a formal business plan written with external audience such as banks, potential investors and
employers in mind. This should include:
An executive summary
Product or service description
A marketing plan and revenue forecasts
A production plan and cost estimates
A financial plan that includes
o Net cash flow
o Breakeven analysis
o IRR analysis before and after taxes
o Optimal financing and the weighted average cost of capital
The three Financial Statements along with
o An ROI Analysis (including the DuPont Ratios)
o Estimated Value of the firm at the end of five years
The second part (about 8-12 pages long to be completed separately is a chapter by chapter report with an internal audience (professor and TA) in
mind. Here you list:
What you think are the main accounting concepts under each chapter
How did they come into play in your business plan
The challenges you faced and lessons learnt under each chapter
Any other interesting observations under each chapter
Finally, you should also include your final Excel Worksheet which is essentially a collection of your weekly homework submissions. Similar to the
homework you and your partner are encouraged to work together and even submit identical first part; the second part must be your own
work. More importantly, you must make individual submissions under your particular team. If your partner is not an equal contributor,
you need not share your work with him or her.
EXTRA CREDITS / DEBITS (? %)
Given this is a hard course, students look for ways to earn extra credits. One way to earn these extra credits is to help me improve the learning
environment in class. Examples: asking or answering questions in-class and discussion board, highlighting problems and offering potential solutions
and going the extra mile to meet the needs of fellow students, professor or the TA. You can also earn extra credits by learning from your own
mistakes. Examples: re-submitting a perfect quiz whenever you get a very low score on it.

Professors are sometimes troubled by behaviors that damage the learning environment in class. Accordingly, you will receive an extra debit, if
your behavior is deemed as distracting the learning environment in class. Examples: coming late to class or leaving early (without being excused),
forgetting to bring the laptop or switch off the cell phone, not reading the syllabus carefully, violating the VIP (Very Important Practices) etc.
WHITMAN GRADING POLICY
The faculty at the Whitman School of Management developed and approved a uniform grading policy for our undergraduate program. The
policy has three goals:- To ensure that grading is fair and consistent across courses; - To encourage excellence in student scholarship; and - To ensure
faculty deliver a challenging academic experience.
All instructors who teach undergraduate courses with 15 or more students enrolled are required to follow this grading policy. For all such
courses taken at the Whitman School of Management, the mean grade shall be no higher than 3.30 and the maximum percentage of A/A-s is 33%.
ACADEMIC INTEGRITY:
Syracuse University sets high standards for academic integrity. Those standards are supported and enforced by students, including those who
serve as academic integrity hearing panel members and hearing officers. The presumptive sanction for a first offense is course failure, accompanied
by the transcript notation Violation of the Academic Integrity Policy. The standard sanction for a first offense by graduate students is suspension or
expulsion. Students should review the Office of Academic Integrity online resource Twenty Questions and Answers About the Syracuse University
Academic Integrity Policy and confer with instructors about course-specific citation methods, permitted collaboration (if any), and rules for
examinations.
The Policy also governs the veracity of signatures on attendance sheets and other verification of participation in class activities.
Additional guidance for students can be found in the Office of Academic Integrity resource: What does academic integrity mean?
DISABILITY-RELATED ACCOMMODATIONS:
If you believe that you need accommodations for a disability, please contact the Office of Disability Services(ODS),
http://disabilityservices.syr.edu, located in Room 309 of 804 University Avenue, or call (315) 443-4498 for an appointment to discuss your needs and
the process for requesting accommodations. ODS is responsible for coordinating disability-related accommodations and will issue students with
documented Disabilities Accommodation Authorization Letters, as appropriate. Since accommodations may require early planning and generally are
not provided retroactively, please contact ODS as soon as possible.
Syracuse University and I are committed to your success and to supporting Section 504 of the Rehabilitation Act of 1973. This means that in
general no individual who is otherwise qualified shall be excluded from participation in, be denied benefits of, or be subjected to discrimination
under any program or activity, solely by reason of having a disability.
You are also welcome to contact me privately to discuss your academic needs but please make sure that you provide me the note from
ODS and discuss the special accommodation you need before the end of second week of classes.
RELIGIOUS OBSERVANCES POLICY:
SUs religious observances policy, found at http://supolicies.syr.edu/emp_ben/religious_observance.htm, recognizes the diversity of faiths
represented among the campus community and protects the rights of students, faculty, and staff to observe religious holy days according to their
tradition. Under the policy, students are provided an opportunity to make up any examination, study, or work requirements that may be missed due to
a religious observance provided they notify their instructors before the end of the second week of classes.

For fall and spring semesters, an online notification process is available through MySlice/Student Services/Enrollment/My Religious
Observances from the first day of class until the end of the second week of class.
VIP (VERY IMPORTANT PRACTICES) WITH EXTRA CREDIT/DEBIT IMPLICATIONS
Given this is a large class, we have to minimize distractions and maximize effectiveness. So take careful note of these 12 VIPs!
1. Do not email me about missing classes because the grade distribution allows you to miss a couple of classes.
2. Do not email me questions you should be posting on the discussion board so everyone can benefit from your question and my response.
3. For personal issues, visit with me during the office hours (Tue, Thu 7-8 pm) as we can resolve things then and there.
4. If you cannot visit during this time, please leave a voice message (315 443 3355) or email (athevara@syr.edu) me during this time.
5. You can expect my responses to your emails, voice messages and discussion board messages only after my two office hours (T, Th 8 pm).
6. No late submissions will be accepted for in-class notes and homework.
7. Make-up quizzes will never be given after they have been conducted in class.
8. Any dispute over graded assignments must be resolved with the TA by the following Friday by visiting the Friday Help Sessions.
9. If you cannot visit, email her your reasons for requesting a re-grade, knowing well that a regrade can decrease your grade as well.
10. You cannot request to meet with the TA outside of the Friday Help Sessions.
11. I will hold longer office hours if and when needed.
12. ODS students must visit with me during my office hours before the end of the third week to discuss suitable accommodations.
COURSE SCHEDULE:

Week

An Entrepreneurs Question

Accounting Concept

Home Work

1:19-23
1:26-30
2:2-6
2:9-13
2:16-20
2:23-27
3:1-8

1:
2:
3:
4:
5:
6:
7:

Managerial versus Financial Accounting

Language of Entrepreneurial Management
Language of Marketing Management
Language of Operational Management
Language of Strategic Management
BE (Break-Even) Analysis
IV (Incremental Value) Analysis

Find your Partner

DNA Analysis
Predicting Market Demand
Net Cash Flow
Monetary Value of Strategies
Percentage Margin of Safety
Opportunity Cost of Time

3:10
3:22-26
3:29-4:2
4:5-9
4:12-16
4:19-23

Quiz 1
8: How do you incorporate cost of capital and operational risk?
9: How do you incorporate taxes?
10: What is the optimal way to finance your organization?
11: What are the three basic Financial Statements?
12: How do you keep your books?

NPV (Net Present Value) Analysis

Tax Analysis
Language of Financial Management
CF St, IC St & BL Sheet
Transaction Analysis

Interpreting NPV and IRR

Estimating After-tax IRR
Estimating WACC
Inferences from F/S
Double Entry

Why is accounting essential for an organization?

Why dont you become an entrepreneur?
How do you estimate the revenues of your organization?
How do you manage the costs of your organization?
How can clever strategies improve your net cash flow?
How do you deal with demand uncertainty?
How do you identify information relevant for a decision?

4:26-30
5:3
5:7

13: What do investors look for in the Financial Statements?

Quiz 2
Business Plans (both Excel and Word files)

ROI (Return on Investment) Analysis

DuPont Ratios

Due on Blackboard (11:59 PM)

Individual Submissions
Identical Business Plans Okay