SOLUTION MANUAL FOR
FINANCIAL ACCOUNTING FOR MANAGERS 1ST EDITION BY WAYNE THOMAS
AND DAVID SPICELAND AND MARK NELSON
CHAPTER 1
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A FRAMEWORK FOR FINANCIAL ACCOUNTING
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REAL WORLD PERSPECTIVES
RWP1-1 EDGAR Nike (ticker: NKE)
C
Requirement 1
a. $23,717 million
b. $9,040 million
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c. Total liabilities = Total assets – total shareholder’s equity
$23,717 – $9,040 = $14,677 million
N
Requirement 2
a. $39,117 million. Revenue increased from the previous year.
b. $4,029 million. Net income increased from the previous year.
N
Requirement 3
a. Operating cash flow = $5,903 million. Operating cash flow was more positive
O
than the previous year.
b. Investing cash flow = −$264 million. Investing cash flow went from positive to
negative from the previous year.
IS
c. Financing cash flow = −$5,293 million. Financing cash flow was more negative
than the previous year.
SE
RWP1-2 EDGAR Netflix Inc (ticker: NFLX)
Requirement 1
a. Average paying membership increased by 23% and average monthly revenue per
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paying membership increased by 5%.
b. $2,795,434 / $20,156,447 = 13.9%
c. $2,652,462, 13% of revenues
R
Requirement 2
a. $9,801,215 / $24,504,567 = 40%
b. $33,141 million
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Solutions Manual, Chapter 5 5-1
,M
ED
C
O
N
N
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IS
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5-2 Financial Accounting for Managers
, Requirement 3
a. $20,723,441. Long-term debt went up from the previous year.
b. $736,969
Requirement 4
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9%
Requirement 5
a. Ernst & Young LLP
ED
b. Yes
RWP1-3 EDGAR General Mills Inc. (ticker: GIS)
C
Requirement 1
First Quarter.
O
Requirement 2
August 26, 2018. The same quarter of last year is used as the comparison quarter.
N
Requirement 3
The quarterly report includes 15 notes.
N
RWP1-4 EDGAR Nordstrom Inc. (ticker: JWN)
O
Requirement 1
The COVID-19 pandemic.
IS
Requirement 2
On March 23, 2020, the Company announced that it would be taking several steps in an abundance
of caution to proactively strengthen its financial flexibility and navigate through this unprecedented
SE
situation. Specifically, the Company suspended its quarterly dividend beginning in the second
quarter of 2020, drew down $800 million on its Revolving Credit Facility, targeted further
reductions of more than $500 million in operating expenses, capital expenditures, and working
capital, and suspended share repurchases.
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Solutions Manual, Chapter 5 5-3
, RWP1-5 Financial Analysis: American Eagle
($ in thousands)
Requirement 1
Total assets = $3,328,679
M
Total liabilities = $2,080,826
Stockholders’ equity = $1,247,853
Assets = Liabilities + Stockholders’ Equity
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$3,328,679 = $2,080,826 + $1,247,853
Requirement 2
Consolidated Statements of Operations
C
Requirement 3
Net sales = $4,308,212
Net income = $191,257
O
Requirement 4
Inflows Outflows
N
Investing activities Sale of available-for-sale Capital expenditures for
investments property and equipment
N
Financing activities Net proceeds from stock Repurchase of common stock
options exercised
O
Requirement 5
The company’s auditor is Ernst & Young LLP.
The auditor states, ―We have audited the accompanying consolidated balance sheets of American
IS
Eagle Outfitters, Inc. (the Company) as of February 1, 2020 and February 2, 2019, the related
consolidated statements of operations, comprehensive income, stockholders’ equity and cash flows
for each of the three years in the period ended February 1, 2020, and the related notes (collectively
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referred to as the ―consolidated financial statements‖). In our opinion, the consolidated financial
statements present fairly, in all material respects, the financial position of the Company at February
1, 2020 and February 2, 2019, and the results of its operations and its cash flows for each of the three
years in the period ended February 1, 2020, in conformity with U.S. generally accepted accounting
principles.‖
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5-4 Financial Accounting for Managers
