An International Accounting Practice Set

The Karissa Jean's Simulation

Erdener Kaynak, Nancy Schendel

• Publisher: Routledge
• Year: 2013
• eBook ISBN: 9781134736218
• Topic: Business
• Subtopic: Business General
• Index: Business

In An International Accounting Practice Set, the only currently available simulation for international accounting, business and accounting students assume the role of a newly-hired employee in the international accounting department of Karissa Jean's, an international distributor of men's and women's jeans. In this role, the student first participates in the company's training program in international business and accounting, working through the first section of the book. After completing the training program, the student performs as an international accountant in Karissa Jean's international accounting department, moving through the second part of the book. In this fashion, readers have a hands-on opportunity to apply newly acquired knowledge in a realistic business setting.The Karissa Jean's simulation works for both those with some familiarity with this topic and for those with no knowledge of international business or accounting. While the authors have targeted the book to community college students, private business school students, and undergrad business and accounting students (with at least one course of Principles of Accounting), this simulation also works for recertification training for accountants and for basic training in business (for new employees or to retrain other employees in international business or accounting principles), industry, and government.The simulation is twofold: job training and job simulation. The training manual of An International Accounting Practice Set teaches readers everything they need to complete the simulation. As a Karissa Jean's "accountant," readers will learn firsthand:

• how to convert foreign currencies to U.S. dollars and vice versa.
• how to record international sales, purchases, cash payments, and cash receipts in an American company's general ledger and in a foreign marketing subsidiary ledger.
• how to record adjusting entries for unsettled accounts payable and accounts receivable at the end of the accounting period.
• how to audit the French marketing subsidiary's ledger and identify and correct any errors.
• how to translate foreign financial statements from French francs into U.S. dollars.
• how to perform problem-solving and writing activities, such as translating a Spanish memo into English and preparing an outline for a speech on international accounting.In doing the Karissa Jean's simulation, students begin to apply classroom knowledge in an employment setting. It is an ideal approach for students with no prior knowledge of international business or accounting who wish to pursue that career field. Those who are familiar with accounting will appreciate the "hands on" opportunity to test their knowledge in an international employment setting. All readers will come to better understand international business issues, including balance of trade and balance of payments, international trade organizations like GATT, the World Bank, and cartels. An International Accounting Practice Set explores related issues in international business, such as ways to enter foreign markets, potential obstacles to foreign trade--cultural and language differences, economic conditions, marketing difficulties, fluctuating currency exchange rates, government instability, and trade protectionism--and provides ideas on how to overcome or prevent such obstacles from becoming trade barriers.

Training Manual

Chapter 1

Introduction

At Karissa Jean’s we believe it is important that all employees understand how our company started and how it grew to become the international company it is today. This background will help you better understand company policies and the reasoning behind company decisions and practices.

Another purpose of this training program is to familiarize you with international business procedures, international accounting practices, and Karissa Jean’s international accounting system.

THE ORIGIN OF KARISSA JEAN’S

In the fall of 1974, at age 18, Karissa Jean Fowler entered the University of Virginia to pursue a degree in elementary education. To support herself and to pay college expenses, Karissa worked 30 hours a week as a seamstress at a garment factory, Silver Threads. Silver Threads is a contract manufacturer, which sews garments for a variety of clothing companies according to their specifications. The clothing companies then market the garments under their own brand names to retailers, who in turn sell them to consumers.

Karissa took her job at Silver Threads seriously and decided to learn all that she could about the garment industry. After about a year, Karissa was promoted to Production Supervisor of her shift At about that time, Karissa decided to make a career of the garment industry and changed her major to marketing. Karissa received several promotions at Silver Threads and worked in a variety of capacities for the company.

Karissa graduated from the University of Virginia in the spring of 1979. Her marketing degree and five years’ experience in the garment industry enabled Karissa to land a job in the marketing department of Levi Strauss of San Francisco, a well-known and highly successful manufacturer of jeans and other clothing products.

Karissa had a successful career at Levi Strauss and was involved in developing marketing and promotional programs for the company’s products for sale throughout the United States and, eventually, internationally.

Early in her career, Karissa developed the goal of one day owning her own garment company, probably manufacturing and selling jeans. Throughout her career at Levi Strauss, Karissa lived modestly and saved and invested her money, planning ahead to the day when she would start her company. In 1987, after nearly nine years in the marketing department at Levi Strauss, Karissa left the company to pursue her dream. Karissa was 31 years old at the time.

Karissa believed that she could locate her company anywhere in the United States and still have the same chance of being successful. She chose Denver, Colorado, because of its somewhat central location, relatively low rent and labor costs, and excellent transportation facilities. There were personal reasons, too. On her many business trips around the country for Levi Strauss, Karissa had fallen in love with the Denver area and the nearby Rocky Mountains and had decided that one day she would like to live there, if possible. Since she was now starting her own company, it was indeed possible. And, it turned out to be a good move.

Karissa obtained a three-year lease on office and warehouse facilities at 8677 Colfax Avenue. Next, Karissa hired two key employees, Jill Ryan as office manager, and Sean McMasters as sales manager. By this time Karissa’s old friends at Silver Threads in Charlottesville, Virginia, had completed 500 samples of Karissa’s new jean designs.

Karissa and Sean spent the next two months traveling the country, contacting purchasing agents for major department stores, chains, and catalog companies. The acceptance of Karissa Jean’s line of jeans was outstanding.

By the end of 1987, orders for more than $1 million had been placed and Karissa Jean’s was on its way to becoming a huge success in the garment industry.

By the end of 1990, annual sales reached $5 million in the United States and Karissa Jean’s decided to enter the international market. Karissa Jean’s international business activities will be explained to you in detail after you read the forthcoming section on international business.

Karissa Jean’s Jeans

Karissa began experimenting with clothing designs while a part-time employee at Silver Threads while attending college. She continued to study fabrics and experiment with designs during her years at Levi Strauss. By the time she left Levi Strauss to start her own company, Karissa had decided on an image for her jeans and had selected the proper fabric and design to project that image.

Karissa Jean’s jeans have been positioned for the upscale designer market. The fabric is a tightly woven, slightly brushed denim that is just as strong and durable as that used for work jeans, yet the jeans are attractive enough to be worn for nearly any social occasion.

The jeans carry the distinctive Karissa Jean’s logo on the back pocket and also on the front just below the waistband. This is the same logo that now appears on all of Karissa Jean’s letterheads, invoices, and other printed materials.

Since the contour of the male body and the female body differ, Karissa decided to develop different patterns for each sex.

The result of this careful planning is a strong, durable, attractive jean with a great fît and prestige image.

Karissa Jean’s does not own any manufacturing facilities or equipment. All of the manufacturing is done by contract manufacturers in the garment industry, with Silver Threads being the major supplier. Karissa Jean’s main activities, then, are designing and marketing the jeans.

More About Karissa Jean’s Later

Additional information about Karissa Jean’s current business activities will be presented later in this training manual. But now, study the following information on international busin...

Table of contents

• Front Cover
• Half Title
• Title Page
• Copyright
• Dedication
• About The Authors
• Contents
• Preface
• I. Training Manual
• II. Simulation
• III. Accounting Journal
• Index