TESTBANK
Accounting Principles 14th Edition
by Jerry J. Weygandt, Paul D. Kimmel
Chapters 1 - 27, Complete
,TABLE OF CONTENTSa a
1 Accounting in Action
a a a a
2 The Recording Process
a a a a
3 Adjusting the Accounts
a a a
4 Completing the Accounting Cycle
a a a a
5 Accounting for Merchandising Operations
a a a a
6 Inventories
a a
7 Accounting Information Systems
a a a a
8 Fraud, Internal Control, and Cash
a a a a a a
9 Accounting for Receivables
a a a a
10 Plant Assets, Natural Resources, and Intangible Assets
a a a a a a a
11 Current Liabilities and Payroll Accounting
a a a a a
12 Accounting for Partnerships
a a a
13 Corporations: Organization and Capital Stock Transactions
a a a a a a
14 Corporations: Dividends, Retained Earnings, and Income Re
a a a a a a a
porting
,15 Long-Term Liabilities
a a
16 Investments
a
17 Statement of Cash Flows
a a a a
18 Financial Analysis: The Big Picture
a a a a a a
19 Managerial Accounting
a a a
20 Job Order Costing
a a a a
21 Process Costing
a a a
22 Cost-Volume-Profit
a a
23 Incremental Analysis
a a a
24 Budgetary Planning
a a
25 Budgetary Control and Responsibility Accounting
a a a a a a
26 Standard Costs and Balanced Scorecard
a a a a a a
27 Planning for Capital Investments
a a a a a
, CHAPTER 1 a
ACCOUNTING IN ACTION a a
CHAPTER LEARNING OBJECTIVES
a a
1. Identifyatheaactivitiesaandausersaassociatedawithaaccounting.aAccountingaisaanainformationasystematha
taidentifies,arecords,aandacommunicatesatheaeconomicaeventsaofaanaorganizationatoainterestedausers.aTh
eamajorausersaandausesaofaaccountingaareaasafollows:a(a)aManagementausesaaccountingainformationatoap
lan,aorganize,aandarunatheabusiness.a(b)aInvestorsa(owners)adecideawhetheratoabuy,ahold,aorasellatheirafin
ancialainterestsaonatheabasisaofaaccountingadata.a(c)aCreditorsa(suppliersaandabankers)aevaluateathearisksa
ofagrantingacreditaoralendinga moneya onatheabasisaofaaccountingainformation.aOtheragroupsathatauseaac
countingainformationaareataxingaauthorities,aregulatoryaagencies,acustomers,aandalaboraunions.
2. Explainatheabuildingablocksaofaaccounting:aethics,aprinciples,aandaassumptions.aEthicsaareatheastandar
dsaofaconductabyawhichaactionsaareajudgedaasarightaorawrong.aEffectiveafinancialareportingadependsaonas
oundaethicalabehavior.
Generallyaacceptedaaccountingaprinciplesaareaaacommonasetaofastandardsausedabyaaccountants.aTheapri
maryaaccountingastandard-
settingabodyainatheaUnitedaStatesaisatheaFinancialaAccountingaStandardsaBoard.
3. Stateatheaaccountingaequation,aandadefineaitsacomponents.aTheabasica accountingaequationais:
Assetsa=aLiabilitiesa+aOwner'saEquity
Assetsa area resourcesa aa businessa owns.a Liabilitiesa area creditorshipa claimsa ona totala assets.aOwner'saequit
yaisatheaownershipaclaimaonatotalaassets.
Theaexpandedaaccountingaequationais:
Assetsa aLiabilitiesa+aOwner'saCapitala aOwner'saDrawingsa+aRevenuesa
Expenses
Investmentsabyaownersa(assetsatheaowneraputsaintoatheabusiness)aarearecordedainaaacategoryacalledaow
ner‘sacapital.aOwner‘sadrawingsaareatheawithdrawalaofaassetsabyatheaowneraforapersonalause.aRevenuesa
areatheagrossaincreaseainaowner‘saequityafromabusinessaactivitiesaforatheapurposeaofaearningaincome.aEx
pensesaareatheacostsaofaassetsaconsumedaoraservicesausedaina thea processa ofa earninga revenue.a Owner‘
sa equitya isa increaseda bya ana owner‘sa investmentsaandabyarevenuesafromabusinessaoperations.aOwner‘sa
equityaisadecreasedabyaanaowner‘sawithdrawalsaofaassetsaandabyaexpenses.
4. Analyzeatheaeffectsaofabusinessatransactionsaonatheaaccountingaequation.aEachabusinessatransactionam
ustahaveaaadualaeffectaonatheaaccountingaequation.aForaexample,aifaanaindividualaassetaincreases,atherea
mustabeaaacorrespondinga(1)adecreaseainaanotheraasset,aora(2)aincreaseainaaaspecificaliability,aora(3)aincre
aseainaowner'saequity.
5. Describeatheafourafinancialastatementsaandahowatheyaareaprepared.aAnaincomeastatementapresentsath
earevenuesaandaexpenses,aandaresultinganetaincomeaoraneta lossaforaaa specificaperiodaofatime.aAnaowner
'saequityastatementasummarizesatheachangesainaowner'saequityaforaaaspecificaperiodaofatime.aAabalanceas
heetareportsatheaassets,aliabilities,aandaowner'saequityaataaaspecificadate.aAastatementaofacashaflowsasum
marizesainformationaaboutatheacashainflowsa(receipts)aandaoutflowsa(payments)aforaaaspecificaperiodaofa
time.
