Journal ofAccounting
Education, Vol. IO. pp. 215-233,
Printed in the USA. All rights reserved.

1992
Copyright

074%5751/92$5.00+.0
0 1992 Pergamon Press Ltd.

Case

INTRODUCING

ACCOUNTING - A COMPREHENSIVE
CASE APPROACH

SOUTHERN

Marvin L. Carbon
METHODIST UNIVERSITY

3. Warren Higgins
UNIVERSITY OF CONNECTICUT

SOUTHERN

Virginia L. Lewis
METHODIST UNIVERSITY

Abstract: The paper presents a 4-part case study designed to be used in introducing the subject matter of financial accounting to undergraduate students, to MBAs, or to executives in a participative and intuitive fashion. Part 1 introduces the theoretical constructs of accounting
(e.g., the entity, revenue recognition, valuation) and the fundamen~Is of balance sheet prepamtion, part 2 the topic of income measurement, part 3 the subject of cash flows, and part 4 the recording of tmnsactions in worksheet format. As the setting for the case is a mythical barter economy in the high mountains of ChateIe, the student is forced to put aside preconceptions of accounting as a mere set of procedural rules and to think (and rethink} choices and issues in the manner of an intellectual puzzle. The parts are solved sequentially, with common solutions agreed upon before the undertaking of the next piece. The final section of the paper presents plausible solutions.

For years, accounting educators have sought a genuinely new and more effective way of introducing the subject matter of accounting. This was a significant concern of the Study Group on Introductory Accounting (1971) sponsored by the Price Waterhouse Foundation. That report illustrated innovative approaches with “The Sheepherders,” a case which required students to analyze the relative financial position of two sheepherders in a barter economy located in the high mountains of Chatele. The case illustrated the major