The Long-Term Effect of the First Course in Accounting on Graduation Rates

We study the impact of business major student performance in the Introductory Financial Accounting (IFA) class on their graduation rates. The results show that the student GPA in the first semester, the cumulative final exam score in the IFA class and the term in which the class is taken significantly impact graduation rates. Though past studies have indicated that first term GPA is a good predictor of graduation rates, we find that performance in the IFA class has additional predictive value of graduation rates. Our results remain robust after controlling race, gender, major and embedded tutors.