FULL SOLUTION MANUAL FOR
Financial And Managerial Accounting 4th Edition by Jerry J
Weygandt, Paul D Kimmel, Jill E Mitchel
CHAPTER 1 t
Accounting in Action t t
ASSIGNMENTtCLASSIFICATIONtTABLE
BrieftExer A
LearningtObjectives Questions cises DotIt! Exercises Problems
1. 1,t2,t3,t4,t5 1 1,t2
Identifytthetactivitiestandt
userstassociatedtwithtac
counting.
2.tExplaintthetbuildingtblockstoftac 6,t7,t8,t9,t10 2 3,t4
counting:tethics,tprinciples,tan
dtassumptions.
3. 11,t12,t13,t14. 1,t2,t3,t4,t5 3 5
Statetthetaccountingte 22
quation,tandtdefinetitstc
omponents.
4. 15,t16,t18 6,t7,t8,t9 4 6,t7,t8 1A,t2A,t4A,
Analyzettheteffectstoftbusine 5A
ssttransactionstontthetaccoun
tingtequation.
5. 17,t19,t20,t21, 10,t11 5 8,t9,t10,t11, 2A,t3A,t4A,
Describetthetfourtfinancialtst 12,t13,t14,t15, 5A
atementstandthowttheytaretpr 16,t17,t18
epared.
obtaintpermissionttotreusetthistmaterialtistavailabletatthttp://www.wiley.com/go/permissions.
, ©t2021tJohntWileyt&tSons,tInc.tAlltrightstreserved.tNotparttoftthistpublicationtmaytbetreproduced,tstoredtintatretrievaltsystem,torttransmitted,tinta
nytformtortbytanytmeans,telectronic,tmechanical,tphotocopying,trecordingtortotherwise,texceptt ast permittedtbytlaw.tAdvicet onthowtto
1-2 ©t2021tJohntWileyt&tSons,tInc.tAlltrightstreserved.t Weygandt,tFinancialt&tManagerialtAccountingt4e,tSolutionstManualttt (Fort InstructortUsetOnly)
, ANSWERS TO QUESTIONS t t
1. True.tVirtuallyteverytorganizationtandtpersontintourtsocietytusestaccountingtinformation.tBusinesses
,tinvestors,tcreditors,tgovernmenttagencies,tandtnot-for-
profittorganizationstmusttusetaccountingtinformationttotoperateteffectively.
LOt 1,t BT:t K,t Difficulty:t Easy,t TOT:t 2t min.,t AACSB:t None,t AICPAt FC:t Reporting,t IMA:t Reporting
2. Accountingtistthetprocesstoftidentifying,trecording,tandt communicatingt theteconomicteventstoftanto
rganizationttotinterestedtuserstoftthetinformation.tThetfirsttactivitytoftthetaccountingtprocesstisttotiden
tifyteconomicteventstthattaretrelevantttotatparticulartbusiness.tOncetidentifiedtandtmeasured,ttheteve
ntstaretrecordedttotprovidetathistorytoftthetfinancialtactivitiestoftthetorganization.tRecordingtconsistst
oftkeepingtatchronologicaltdiarytoftthesetmeasuredteventstintantorderlytandtsystematictmanner.tTheti
nformationtistcommunicatedtthroughtthetpreparationtandtdistributiontoftaccountingt reports,t thet mo
stt commont oft whichtaret calledtfinancialtstatements.tAtvitaltelementtintthetcommunicationtprocessti
stthetaccountant’stabilitytandtresponsibilityttotanalyzetandtinterprettthetreportedtinformation.
LOt 1,t BT:t K,t Difficulty:t Easy,t TOT:t 2t min.,t AACSB:t None,t AICPAt FC:t Reporting,t IMA:t Reporting
3. (a)tInternaltuserstaretthosetwhotplan,torganize,tandtruntthetbusinesstandtthereforetaretofficerstandtot
hertdecisiontmakers.
(b) Totassisttmanagement,taccountingtprovidestinternaltreports.tExamplestincludetfinancialtcomp
arisonstoftoperatingtalternatives,tprojectionstoft incometfromtnewtsalestcampaigns,tandtforeca
ststoft cashtneedstfortthetnexttyear.
LOt 1,t BT:t K,t Difficulty:t Easy,t TOT:t 2t min.,t AACSB:t None,t AICPAt FC:t Reporting,t IMA:t Reporting
4. (a) Investorst(owners)tusetaccountingtinformationttotmaketdecisionsttotbuy,thold,tortselltstock.
(b) Creditorstusetaccountingtinformationttotevaluatetthetriskstoftgrantingtcredittortlendingtmoney.
LOt 1,t BT:t K,t Difficulty:t Easy,t TOT:t 2t min.,t AACSB:t None,t AICPAt FC:t Reporting,t IMA:t Reporting
5. False.tBookkeepingtusuallytinvolvestonlytthetrecordingtofteconomicteventstandtthereforetistjusttonet
parttoftthetentiretaccountingtprocess.tAccounting,tontthetotherthand,tinvolvestthetentiretprocesstoftid
entifying,trecording,tandtcommunicatingteconomictevents.
LOt 1,t BT:t C,t Difficulty:t Easy,t TOT:t 2t min.,t AACSB:t None,t AICPAt FC:t Reporting,t IMA:t Reporting
6. HarpertTraveltAgencytshouldtreporttthetlandtatt$85,000tontitstDecembert31,t 2022t balancetsheet.tT
hististtruetnottonlytattthettimetthetlandtistpurchased,tbuttalsotovertthettimetthetlandtistheld.tIntdetermini
ngtwhichtmeasurementtprinciplettotuset(historicaltcosttortfairtvalue)tcompaniestweightthetfactualtnat
uretoftcosttfigurestversustthetrelevancetoftfairtvalue.tIntgeneral,tcompaniestusethistoricaltcost.tOnlytin
tsituationstwheretassetstaretactivelyttradedtdot companiestapplytthetfairtvaluetprinciple.
LOt 2,t BT:t C,t Difficulty:t Easy,t TOT:t 2t min.,t AACSB:t None,t AICPAt FC:t Measurement,t Analysist andt Interpretationt IMA:tReporting
7. Thetmonetarytunittassumptiontrequirestthattonlyttransactiontdatatcapabletoftbeingtexpressedtintterm
stoftmoneytbetincludedtintthetaccountingtrecords.tThistassumptiontenablestaccountingttotquantifyt(m
easure)teconomictevents.
LOt2,tBT:tK,tDifficulty:tEasy,tTOT:t2tmin.,tAACSB:tNone,tAICPAtFC:tMeasurement,tAnalysistandtInterpretationt IMA:tReporting
obtaintpermissionttotreusetthistmaterialtistavailabletatthttp://www.wiley.com/go/permissions.
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