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Solutions Manual Intermediate Accounting; Prepared for Use in Accounting 302,
- Course
- FINANCIAL ACCOUNTING
- Institution
- Liberty University
Solutions Manual Intermediate Accounting; Prepared for Use in Accounting 302,
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SOLUTION MANUALFinancial Accounting 11th
Edition
by Jerry J’ Weygandt, Paul D’ Kimmel
Chapters 1 - 13 | Complete
,TABLE OF CONTENTS
Chapter 1’ Accounting in Action
Chapter 2’ The Recording Process
Chapter 3’ Adjusting the Accounts
Chapter 4’ Completing the Accounting Cycle
Chapter 5’ Accounting for Merchandising Operations
Chapter 6’ Inventories
Chapter 7’ Fraud, Internal Control and Cash
Chapter 8’ Accounting for Receivables
Chapter 9’ Plant Assets, Natural Resources and Intangible
Assets Chapter 10’ Liabilities
Chapter 11’ Corporations: Organisations, Stock Transactions and
Stockholders’ Equity
Chapter 12’ Statement of Cash Flows
Chapter 13’ Financial Analysis: The Big Picture
,CHAPTER 1
Accounting in Action
ASSIGNMENT CLASSIFICATION TABLE
Brief A
Learning Objectives Questions Exercises Do It! Exercises Problems
1. Identify the activities 1, 2, 3, 4, 5 1 1, 2
and users associated
with accounting’
2. Explain the building blocks 6, 7, 8, 9, 10 2 3, 4
of accounting: ethics,
principles, and
assumptions’
3’ State the accounting 11, 12, 13, 14’ 1, 2, 3, 4, 5 3 5
equation, and define its 22
components’
4’ Analyze the effects of 15, 16, 18 6, 7, 8, 9 4 6, 7, 8 1A, 2A,
business 4A,
transactions on 5A
theaccounting
equation’
5’ Describe the four financial 17, 19, 20, 21, 10, 11 5 8, 9, 10, 11, 2A, 3A,
4A,
statements and how they 12, 13, 14, 15, 5A
are
prepared’ 16, 17, 18
, ANSWERS TO QUESTIONS
1. True’ Virtually every organization and person in our society uses accounting information’
Businesses, investors, creditors, government agencies, and not-for-profit organizations
must use accounting information to operate effectively’
LO 1, BT: K, Difficulty: Easy, TOT: 2 min’, AACSB: None, AICPA FC: Reporting, IMA: Reporting
2. Accounting is the process of identifying, recording, and communicating the economic
events of an organization to interested users of the information’ The first activity of the
accounting process is to identify economic events that are relevant to a particular
business’ Once identified and measured, the events are recorded to provide a history of
the financial activities of the organization’ Recording consists of keeping a chronological
diary of these measured events in an orderly and systematic manner’ The information is
communicated through the preparation and distribution of accounting reports, the most
common of which are called financial statements’ A vital element in the communication
process is the accountant’s ability and responsibility to analyze and interpret the reported
information’
LO 1, BT: K, Difficulty: Easy, TOT: 2 min’, AACSB: None, AICPA FC: Reporting, IMA: Reporting
3. (a) Internal users are those who plan, organize, and run the business and therefore are
officers and other decision makers’
(b) To assist management, accounting provides internal reports’ Examples include
financial comparisons of operating alternatives, projections of income from new
sales campaigns, and forecasts of cash needs for the next year’
LO 1, BT: K, Difficulty: Easy, TOT: 2 min’, AACSB: None, AICPA FC: Reporting, IMA: Reporting
4.
(a) Investors (owners) use accounting information to make decisions to buy, hold, or sell
stock’
(b) Creditors use accounting information to evaluate the risks of granting credit or lending money’
LO 1, BT: K, Difficulty: Easy, TOT: 2 min’, AACSB: None, AICPA FC: Reporting, IMA: Reporting
5. False’ Bookkeeping usually involves only the recording of economic events and therefore
is just one part of the entire accounting process’ Accounting, on the other hand, involves
the entire process of identifying, recording, and communicating economic events’
LO 1, BT: C, Difficulty: Easy, TOT: 2 min’, AACSB: None, AICPA FC: Reporting, IMA: Reporting
6. Harper Travel Agency should report the land at $85,000 on its December 31, 2022 balance
sheet’ This is true not only at the time the land is purchased, but also over the time the
land is held’ In determining which measurement principle to use (historical cost or fair
value) companies weigh the factual nature of cost figures versus the relevance of fair
value’ In general, companies use historical cost’ Only in situations where assets are
actively traded do companies apply the fair value principle’
LO 2, BT: C, Difficulty: Easy, TOT: 2 min’, AACSB: None, AICPA FC: Measurement, Analysis and Interpretation IMA: Reporting
7. The monetary unit assumption requires that only transaction data capable of being
expressed in terms of money be included in the accounting records’ This assumption
enables accounting to quantify (measure) economic events’
LO 2, BT: K, Difficulty: Easy, TOT: 2 min’, AACSB: None, AICPA FC: Measurement, Analysis and Interpretation IMA:Reporting
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