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Accounting for Decision Making

Through this course, you will start by addressing the two “big questions” of accounting: “What do I have?” and “How did I do over time?” You will see how the two key financial statements – the balance sheet and the income statement - are designed to answer these questions and then move on to consider how individual transactions aggregate to make up these financial statements. After developing a broad understanding of accounting and financial statements, you will begin to develop a more nuanced understanding of individual components of doing business, such as making a sale or building inventory. By considering many of the more common actions of a company, you will build your understanding of accounting, and explore these concepts by applying them across various types of transactions. Once you understand these individual concepts better, you will be ready to return to the overall financial statements and use them as informational tools, including building ratios.

You can do this course standalone or to qualify for the residential component of the Finance for Strategic Decision-Making Executive Education program. For more information, see the FAQ below.

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Syllabus

Why Do We Have Accounting and How Can You Make it Work for You?

Every organized society needs information about its activities and accomplishments. Accounting was created to fulfill this need. In this module we will explore how accounting was designed to meet the needs of decision makers and what this means to you as a user of accounting information. We will discuss the concept behind accrual accounting including introducing the two primary accrual accounting financial statements - the balance sheet and income statement. This module will discuss the purpose and goal of those financial statements, but we will save your experience in creating those statements until module two. In lesson two of this module, we will explore some basic bookkeeping tools that will get you ready to create a set of financial statements. The material in this module is likely to take less than a week, but we will make up for it in module two.

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Emphasizes core accounting principles and their foundational role in making effective decisions

Covers a comprehensive range of financial reporting concepts, including revenue recognition, asset valuation, and cash flow

Teaches practical accounting skills through real-world examples and applications

Facilitates the development of financial literacy and numeracy skills

Provides a solid foundation for further study in accounting and finance

Recommended for individuals seeking to enhance their understanding of financial statements and accounting practices

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Reviews summary

Accounting fundamentals for decision makers

According to learners, this course provides a solid foundation in accounting basics, moving from understanding financial statements like the balance sheet and income statement to delving into specific items like revenue, inventory, and assets. Students appreciate the focus on using accounting information for decision making and the detailed breakdown of the accounting cycle. While some find the foundational bookkeeping particularly dry or challenging, the course structure is generally seen as logical, although topics like the cash flow statement are highlighted as being particularly difficult. The course culminates in using ratios for insights.

Concepts are explained clearly.

"The instructor does a great job explaining potentially complex topics in a clear and understandable way."

"Videos and readings provided helpful context and examples to solidify understanding."

"Even difficult concepts were broken down into approachable pieces."

Logical flow from basics to application.

"I appreciated the systematic approach, starting with the big picture before diving into specific items and then returning to overall analysis."

"The way the course builds from fundamental concepts to more complex topics felt very logical and well-planned."

"Moving from broad statements to specific items and back to overall statements was a great learning path."

Focus on using accounting for decisions.

"I gained valuable insights into how accounting information can actually be used to make better business decisions."

"The course successfully bridges the gap between theoretical accounting concepts and their practical application in a business context."

"Using ratios to analyze financial statements felt like the 'big payoff' and was very useful."

Module found challenging by learners.

"The cash flow statement module was definitely the toughest part of the course for me; it requires multiple watches as suggested."

"Understanding how to 'undo' accrual accounting for the cash flow statement was quite complex."

"While broken down well, the cash flow concepts were hard to internalize completely by the end of the week."

Foundational content can be challenging.

"Module two, covering the accounting cycle and bookkeeping, felt like the 'least exciting' part, just as the syllabus warned."

"Understanding the basic bookkeeping process is essential, but it required significant effort to grasp fully."

"While necessary for the foundation, the detailed steps of the accounting cycle were somewhat tedious."

Activities

Be better prepared before your course. Deepen your understanding during and after it. Supplement your coursework and achieve mastery of the topics covered in Accounting for Decision Making with these activities:

Read relevant articles on Accounting

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Reading articles can help you familiarize yourself with the vocabulary of Accounting and get a better understanding of the topics you'll encounter in this course.

Browse courses on Accounting

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Identify relevant publications or websites on Accounting
Read articles that address topics related to the course

Review concepts of Accrual Accounting

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Reviewing foundational concepts in Accrual accounting will help you grasp what follows in this course.

Browse courses on Accrual Accounting

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Review notes or readings on Accrual Accounting from previous courses or books
Watch videos or tutorials on Accrual Accounting

Review vocabulary terms

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The general vocabulary of accounting is dense and complex, so subject-specific vocabulary may need to be re-learned or reinforced.

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Go through the definitions for terms covered in the syllabus and textbook introduction.
Create flash cards for terms needed to pursue business goals.

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Organize your notes and materials

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Organizing your materials will help you stay on top of the course work and make it easier to find the information you need.

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Create a system for organizing your notes, handouts, and other materials.
Keep your materials organized throughout the course.
Review your materials regularly.

Review the textbook

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Reading the textbook will help you solidify your understanding of the accounting concepts and principles covered in the course.

View Financial Accounting: Tools for Business... on Amazon

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Read each chapter thoroughly.
Take notes on the key concepts and definitions.
Complete the practice problems at the end of each chapter.

Practice creating journal entries

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Creating journal entries is a fundamental skill that requires lots of practice to improve accuracy and speed.

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Create a T-account for each account affected by the transaction.
Debit the appropriate T-account for the amount of the increase.
Credit the appropriate T-account for the amount of the decrease.

Watch video tutorials on accounting concepts

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Watching videos will help you break down complex concepts into smaller parts and reinforce the textbook reading.

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Find tutorials that cover the topics you are struggling with.
Take notes while watching the videos.
Pause the videos and rewind as needed.

Create a diagram of the accounting cycle

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Creating a visual representation of the accounting cycle will help you understand the flow of transactions and how they are recorded in the financial statements.

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Identify the major steps in the accounting cycle.
Draw a diagram that shows the flow of transactions through each step.
Label the diagram with key terms and concepts.

Practice applying accounting concepts with online tutorials

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Guided tutorials provide a hands-on approach to applying accounting concepts, deepening your understanding.

Browse courses on Accounting

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Search for online tutorials on accounting concepts
Select tutorials that align with the topics covered in the course
Follow the instructions in the tutorials to practice applying accounting concepts

Summarize key concepts from course modules

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Summarizing key concepts will help you internalize and retain the information from each module.

Browse courses on Financial Statements

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Identify key terms and concepts covered in each module
Write a summary of each key concept, including definitions and examples
Review and revise your summaries regularly

Work through practice problems on financial statement analysis

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The complexities of financial statement analysis require lots of practice to develop the skill and grow confidence in its applications.

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Solve practice problems on calculating ratios and analyzing financial statements.
Identify key financial ratios and their interpretations.
Analyze and interpret the results of financial statement analysis.

Discuss accounting concepts with classmates

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Discussing course material with others can help you understand the material more deeply and identify areas where you need additional support.

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Find a study group or partner to work with.
Discuss the course material and share your understanding of key concepts.
Help each other with homework problems and practice questions.

Contribute to an open-source accounting project

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Contributing to an open-source project will give you hands-on experience with real-world accounting applications and help you develop your programming skills.

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Find an open-source accounting project that you are interested in.
Read the project documentation and contribute to the codebase.
Participate in the project's community and discussions.

Career center

Learners who complete Accounting for Decision Making will develop knowledge and skills that may be useful to these careers:

Chief Financial Officer (CFO)

CFOs are responsible for the overall financial health of an organization. They make decisions regarding investments, budgeting, and financial planning. A strong understanding of accounting principles is essential for CFOs, and this course can provide a solid foundation in that area.

See salaries and explore the career path for Chief Financial Officer (CFO)

Controller

Controllers are responsible for overseeing the financial operations of an organization. They prepare financial statements and reports, and they also manage cash flow. This course can be helpful as it provides a comprehensive overview of accounting principles and financial statement analysis.

See salaries and explore the career path for Controller

Manager of Financial Planning and Analysis

Managers of Financial Planning and Analysis are responsible for developing and implementing financial plans for their organizations. They also analyze financial data and make recommendations to senior management. This course can be helpful as it provides a strong foundation in accounting principles and financial statement analysis.

See salaries and explore the career path for Manager of Financial Planning and Analysis

Accountant

Accountants work with financial information and are responsible for preparing financial statements and reports for businesses and organizations. As this course teaches accounting fundamentals, it could prove beneficial to accountants.

See salaries and explore the career path for Accountant

Auditor

Auditors assess the financial records of organizations to ensure accuracy. They also make sure that organizations are compliant with regulations. This course is relevant as it offers insight into how financial statements are created and helps build a foundation for understanding auditing processes.

See salaries and explore the career path for Auditor

Forensic Accountant

Forensic Accountants investigate financial crimes and irregularities. They also provide expert testimony in court. This course could be beneficial as it helps build a foundation in accounting principles and financial statement analysis, which are essential for Forensic Accountants.

See salaries and explore the career path for Forensic Accountant

Financial Consultant

Financial Consultants provide financial advice to individuals and businesses. They help clients with a variety of financial issues, such as budgeting, investing, and retirement planning. This course could be beneficial as it provides a solid foundation in accounting principles and financial statement analysis.

See salaries and explore the career path for Financial Consultant

Budget Analyst

Budget Analysts develop and manage budgets for organizations. They also analyze financial data to identify areas for improvement. This course can be helpful as it provides a foundation in accounting principles and financial statement analysis.

See salaries and explore the career path for Budget Analyst

Tax Accountant

Tax Accountants prepare and file tax returns for individuals and businesses. They also help clients understand tax laws and optimize their tax strategies. Having a solid understanding of financial accounting can be advantageous for Tax Accountants and this course may help build that foundation.

See salaries and explore the career path for Tax Accountant

Credit Analyst

Credit Analysts assess the creditworthiness of individuals and businesses. They also make recommendations regarding lending and credit limits. This course could potentially be of help as it provides a foundation in accounting principles and financial statement analysis, which are relevant to Credit Analysts.

See salaries and explore the career path for Credit Analyst

Financial Planner

Financial Planners help individuals and organizations plan for and manage their finances. They consider factors such as risk tolerance and time horizon when making recommendations. This course may be of help to Financial Planners as it provides a solid understanding of financial statements and how they're created.

See salaries and explore the career path for Financial Planner

Data Analyst

Data Analysts collect, analyze, and interpret data to help businesses make better decisions. They use a variety of statistical and data mining techniques to identify trends and patterns. This course may be useful as it provides a foundation in accounting principles and financial statement analysis, which can be helpful for understanding financial data.

See salaries and explore the career path for Data Analyst

Investment Banker

Investment Bankers help companies raise capital and advise them on mergers and acquisitions. They also analyze financial data and make recommendations to clients. This course may be beneficial as it teaches accounting fundamentals that can help inform investment decisions.

See salaries and explore the career path for Investment Banker

Financial Analyst

Financial Analysts use financial information and knowledge of economic trends to write financial reports. They make recommendations regarding stock purchases and other investment decisions. This course can prove helpful as it teaches financial accounting fundamentals that can help inform investment decisions.

See salaries and explore the career path for Financial Analyst

Risk Manager

Risk Managers assess potential financial impacts of adverse events for their organizations. They create plans to mitigate risks and ensure financial stability. This course would be useful because it can help them understand accounting information and identify potential financial risks.

See salaries and explore the career path for Risk Manager

Reading list

We've selected 16 books that we think will supplement your learning. Use these to develop background knowledge, enrich your coursework, and gain a deeper understanding of the topics covered in Accounting for Decision Making.

Financial Accounting Theory and Analysis

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This textbook provides a comprehensive overview of financial accounting theory and analysis. It covers the basic concepts of financial accounting, including the preparation of financial statements, the analysis of financial statements, and the use of financial information for decision-making.

Accounting for Decision Making

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What's inside

Syllabus

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Reviews summary

Accounting fundamentals for decision makers

Activities

Career center

Reading list

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